Hands in the Potash jar

25 August 2010 By Nicholas Paisner

Barely a week after BHP launched its $39 bln bid for the Canadian mining group, the U.S. watchdog has charged two Spaniards with insider dealing. The speedy international swoop makes the UK Financial Services Authority’s muchhyped crackdown on whitecollar crime look vegetative.

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The U.S. Securities and Exchange Commission said on Aug. 24 ged two residents of Madrid, Spain with insider trading in connection with BHP Billiton's $39 billion hostile bid for Potash Corp. of Saskatchewan.

The SEC alleged that Juan Jose Fernandez Garcia and Luis Martin Caro Sanchez had used inside information about the deal to buy hundreds of "outofthemoney" call options for stock in Potash Corp before the takeover was announced. It said they had made almost $1.1 million in illegal profits from the takeover.

The SEC said that Garcia is head of a research arm of Banco Santander, the Spanish bank that is one of BHP's advisers on the deal and is also helping to finance the takeover.

Both men bought the contracts through accounts at Interactive Brokers LLC.

The UK's Financial Services Authority said on Aug. 25 that it had charged Société Générale 1.6 million pounds ($2.5 million) for failures in transaction reporting between November 2007 and February 2010.

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