The U.S. Securities and Exchange Commission announced Thursday it has charged four executives at Louisville-based Steel Technologies and four of their family and friends with illegal insider trading in advance of the company being acquired.
The four employees were identified by the SEC as Patrick Carroll, William "Tad" Carroll, David Mark Calcutt and David Stitt. All are vice presidents of sales, according to an SEC statement.
The SEC alleges Patrick Carroll tipped his son James Carroll to the acquisition by Mitsui & Co., while Calcutt tipped his brother Christopher Calcutt. Also, the SEC claims Stitt tipped his friend John Monroe, who then tipped friend Stephen Somers.
The eight people purchased $578,000 of Steel Technologies stock in the month prior to the announcement of the acquisition, making $320,000 in profits that were deemed illegal.
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In a statement released Thursday, Steel Technologies leaders said they have been aware of the SEC investigation since 2008 and have "cooperated fully."
The company said it is its policy not to discuss "individual and private actions of our employees," noting the SEC has made no allegations against the company as a whole.
"We remain confident that the company has acted lawfully and ethically throughout the acquisition process and SEC investigation," the statement read.
The SEC is seeking repayment of the profits as well as monetary penalties against all, according to the news release.