The U.S. Securities and Exchange Commission on Thursday accused a former SAP executive and three others of an insider trading scheme that made more than $500,000 in illicit profits based on a tip the executive provided about an impending SAP acquisition.
According to an SEC civil complaint, Christopher Salis, then a global vice president at the software company’s SAP America unit, received thousands of dollars in kickbacks for tipping his close friend Douglas Miller in advance of SAP’s acquisition of Concur Technologies in 2014.
Miller is accused of passing on the tip to his brother, Edward Miller, and a mutual friend, Barrett Biehel. The Millers owned an Indiana car wash and were struggling to keep the business afloat, the SEC alleged.
“This is what we all need to weather any storm and put us on top bro!” Douglas Miller allegedly told his brother in an email, referring to their purchase of Concur call options.
The SEC said it had also linked Salis and Douglas Miller to suspicious trades in 2007 that were made in advance of a tender offer for Business Objects, a company where Salis worked at the time.
“When corporate insiders exploit confidential information to enrich themselves and their friends, they undermine the level playing field that is fundamental to our capital markets,” Scott W. Friestad, associate director of the SEC’s Division of Enforcement, said in a news release.
Salis, who attended Purdue University with the Millers and Biehl and was best man at Douglas Miller’s wedding, worked for SAP from January 2008 to September 2015. The SEC said Salis learned in the summer of 2014 of SAP’s confidential plans to acquire Concur and, based on his tip, the Millers quickly began trading in Concur’s stock.
After news of the acquisition became public in September 2014, the Millers, their parents, Biehl, and another friend allegedly reaped illegal trading profits of more than $505,000 from their initial deposits of less than $45,000.
The payments to Salis allegedly included more than $10,400 in cash just weeks after the merger announcement. In addition, the SEC said, the Millers and their mother wrote $80,000 in checks to an early-stage startup that Salis had founded.