U.S. Seeks Swiss Help in Triangle Insider Probe
Swiss government officials have said that the United States has asked for their assistance in a probe of possible insider trading in Triangle Industries Inc. shares before its acquisition last November.
The U.S. Securities and Exchange Commission told Switzerland on Dec. 16 that it suspected that insiders were at work shortly before France’s state-owned Pechiney SA launched a $1.26-billion bid for Triangle, a major New York-based packaging company, in November.
The Swiss government has frozen an unspecified number of accounts at Swiss Volksbank, Union Bank of Switzerland, Banca della Svizzera Italiana and the Vaud Cantonal Bank pending a formal request for legal assistance from the SEC, a Justice Ministry official said. She declined to identify the banks’ owners.
The SEC had alerted France to a tenfold jump in Triangle share trading the week before Pechiney’s agreed takeover was announced. Pechiney paid $56 a share for stock for which French investors had paid about $10.50 the week before.
Trade in Triangle totaled 200,000 shares for the three-day period of Nov. 16-18, whereas normal daily trading in Triangle shares on the New York over-the-counter market averaged 5,000 to 20,000 shares. Pechiney’s bid was announced Nov. 21.
French regulatory officials investigating the case have said more than five but fewer than 10 French operators bought Triangle shares, but have declined to identify them.
Paris banking sources said Triangle buy orders had also been placed through Britain, Luxembourg and Switzerland on behalf of French investors.
The SEC and officials from its French counterpart, the COB, were set to meet in Paris to coordinate the expanded investigation of the trading.
Triangle Chairman Nelson Peltz said in an interview with France’s Nouvel Observateur magazine published last week that he had been summoned before the SEC in New York and would appear in the next few weeks.
The inquiry has led to a political row in France after published reports that some leading government officials face questioning in the case.
Finance Minister Pierre Beregovoy was pressed by opponents of the Socialist government for a parliamentary inquiry into how some investors had advance knowledge of the takeover.
Max Theret, a businessman close to the ruling Socialist Party, has confirmed that he bought shares in Triangle before the deal but said that it was an unfortunate coincidence. Socialist government officials denied involvement of any top-level ministers, including President Francois Mitterrand.
The conservative RPR, the biggest opposition party, said: “The names of prominent people close to the presidential palace and the Ministry of Finance are being implicated, and there is a growing feeling in public opinion that facts are being suppressed in the Pechiney case.”
Beregovoy on Thursday rose to the defense of his top aide, Alain Boublil, named in the right-wing French press as one of those under investigation.
“The current campaign of rumors which has involved my Cabinet Director Alain Boublil is not a healthy campaign. I am surrounded by honest men in whom I have confidence,” he said.
