The U.S. Securities and Exchange Commission has charged an Atlanta real estate developer with making $744,000 in illicit profits by trading Radiant Systems stock based on insider information he had obtained from a friend connected to the IT company.

Charles L. Hill, Jr., began investing in Radiant stock in June 2011 after the friend shared material, nonpublic information with him about a potential acquisition of Radiant by NCR Corp., the SEC said in an administrative complaint filed earlier this week. The friend, a self-employed artist, had allegedly learned the information from Radiant’s chief operating officer, a friend of the artist since childhood and the brother of Radiant’s CEO.

By the time the $1.2 billion NCR takeover was announced on July 11, 2011, Hill had acquired Radiant stock valued at nearly $2.2. million, according to the SEC. He sold all his holdings the following day, when the stock soared more than 30% on the takeover news.

The SEC’s Enforcement Division has charged Hill, 54, with violating the Securities Exchange Act of 1934.

“The SEC has rules designed to protect against misuse of nonpublic tender offer information,” William P. Hicks, associate regional director of the SEC’s Atlanta office, said in a news release. “We will take action against individuals who acquire such information from insiders and exploit it for their own trading benefit.”

According to the SEC, Radiant’s COO first learned of the possible NCR takeover in early May 2011 from his brother. He, in turn, discussed the information “in confidence with his close personal friend of approximately 40 years.”

“Hill knew or had reason to know that the information [he] acquired from Radiant’s COO’s friend concerning NCR’s potential acquisition of Radiant was nonpublic,” the complaint alleges.

Stephen Hudson, an attorney for Hill, told the Atlanta Journal Constitution that his client “had valid and legitimate reasons for purchasing Radiant Systems’ stock” and Hill’s friend had denied passing inside information to him.

The SEC did not identify the friend or the Radiant executives. But a regulatory filing shows that at the time of the NCR takeover, John Heyman was CEO of Radiant and his brother Andrew was COO.

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