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Ex-loan executive fined over stock tips

November 17, 2006|From Bloomberg News

The Securities and Exchange Commission said Thursday that it fined a former LendingTree Inc. executive $219,000 for allegedly providing tips used in insider trading of the company's stock before a 2003 takeover by Barry Diller's USA Interactive.

David N. Anderson, once a senior vice president of the Internet-based home-loan information service, tipped off three co-workers and a friend to the takeover, the SEC said. The four people then reaped $219,000 in profits by buying stock ahead of time, the agency said.

"It is particularly troubling when a senior officer of a public company, who should be keenly aware of his responsibilities to shareholders, breaches his fiduciary obligations to benefit himself or his friends," Robert Kaplan, an SEC attorney in Washington, said in an e-mailed statement.

The former executive is among at least nine people accused so far by the SEC of involvement in insider trades tied to the takeover. LendingTree shares jumped 41% after New York-based USA Interactive announced the $656-million acquisition, according to the SEC.

USA Interactive is now known as IAC/InterActiveCorp and is run by billionaire Diller.

Anderson also is awaiting sentencing after pleading guilty to a separate felony charge brought by the U.S. attorney's office in North Carolina for making false statements to investigators, according to the SEC.

Anderson's attorney, Theodore Sawicki, couldn't immediately be reached. Anderson neither admitted nor denied wrongdoing in agreeing to settle the SEC case.

The friend and three co-workers allegedly involved in insider trading with him have already settled SEC claims against them.

LendingTree spokeswoman Allison Vail declined to comment.

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