SEC Settles Trading Complaint Based on Waste Management Acquisitions

Danielle Jackson

Houston -- The Securities and Exchange Commission (SEC) has settled a complaint against 10 men for allegedly engaging in illegal insider trading in advance of two 1998 acquisitions by USA Waste, now known as Houston-based Waste Management Inc.

The SEC complaint alleged that then-USA Waste senior vice president William A. Rothrock IV knew ahead of time about USA Waste's plans to buy American Waste Services and Waste Management. The SEC charged that Rothrock tipped off three people about the deal, and eventually word spread to seven others. Similarly, the U.S. government has accused Rothrock of tipping off two people, which spread to eight others.

All but Rothrock purchased American Waste stock prior to the public announcement of its acquisition, leading to the allegations.

All 10 defendants settled without admitting to or denying the allegations, and agreed to pay varying penalty amounts, totaling more than $2.5 million.