Glendale Couple Settle Charges of Insider Trading

A former secretary at a Los Angeles supermarket chain and her brother-in-law have paid more than $96,000 in penalties to settle insider trading charges.

Nancy L. Reggiani, an employee of Boys Markets, was accused of tipping off her brother-in-law, Rodney B. Smith, about a pending, and at the time still-confidential, bid to acquire Boys Markets.

According to the Securities and Exchange Commission, Smith bought 11,000 shares of Boys Market common stock in the weeks before the acquisition by American Breco was announced on March 1, 1988.

In a civil lawsuit filed in California, the SEC alleged Smith made $49,993 in illegal trading profit, $3,200 of which he gave to Reggiani.

Smith and Reggiani, both of Glendale, settled the charges without admitting or denying wrongdoing.

Smith agreed to pay back twice the amount of his alleged illegal profit, minus the $3,200 he allegedly gave Reggiani, for a total of $93,586.

The woman, who was not accused of illegal trading herself, was fined more than $53,000--the amount Smith allegedly made on her tip plus the money he gave her.

But officials waived all but $3,200 of the penalty because of her inability to pay more, said Christopher Berlew, a branch chief with the SEC’s enforcement division.