NEW YORK (Reuters) – The U.S. Securities and Exchange Commission has sued a managing director at private equity firm Blackstone Group (BX.N) for an insider trading scheme involving shares of supermarket chain Albertsons, the Dow Jones newswire said on Tuesday.
Dow Jones said Blackstone managing director Ramesh Chakrapani supplied a friend with material nonpublic information about Albertsons’ acquisition before the deal was announced. According to the report the scheme brought in more than $3.6 million in illegal profits.
A group including of Supervalu (SVU.N), CVS (CVS.N) and private equity firm Cerberus bought Albertsons in 2006. The SEC alleges that Chakrapani was part of the Blackstone team that advised Albertson’s on the deal.
“We are shocked by this alleged breach of the law and violation of our own compliance policies and ethical standards,” said Blackstone spokesman Peter Rose. He said the company was fully cooperating with authorities.
Chakrapani could not be immediately reached for comment. (Reporting by Michael Erman and Megan Davies; Editing by Bernard Orr)