Former New England Executive Charged With Insider Trading

The Securities and Exchange Commission on Friday charged a former executive of SpecTran Corp. with insider trading for selling his company’s shares ahead of an announcement of poor quarterly earnings.

The complaint alleges that Mohad Aslami, a former executive vice president, sold 20,000 shares of SpecTran’s stock just before the company announced substantially lower quarterly earnings in 1986.

Douglas Scarff, administrator of the SEC’s Boston regional office, said the case illustrated the wide scope of insider trading laws. In a news release, he said a trader is liable if he sells stock knowing that there will be a bad news announcement, not only if he makes money from buying stock on inside information.

Aslami, in a consent decree filed along with the complaint, agreed to pay the SEC $117,080, which represents the loss he avoided by selling the stock before the bad news was announced publicly, plus a penalty. He consented to the entry of a permanent injunction against him without admitting or denying the allegations in the case.

The complaint was filed in the Western section of the U.S. District Court for Massachusetts. SpecTran, located in Sturbridge, Mass., makes glass optical fibers for use in telecommunications.

Aslami left SpecTran in August, 1986, several months after he sold the shares in question. He could not be reached for comment.

Bruce Cannon, SpecTran’s vice president for finance, said the company would not comment on the SEC complaint.