US checks for insider trading in Youku-Tudou merger

Summary:The U.S. Financial Industry Regulatory Authority is asking Youku Tudou to explain its relationship with 240 parties currently being looked into for possible insider trading--a procedure required for public companies.

The U.S. Financial Industry Regulatory Authority (FINRA) has asked Youku Tudou--the entity formed after the merger of China's top two online video streaming companies Youku and Tudou--to explain its relationship with 240 parties being investigated for possible insider trading.

A Sina Tech report Saturday said FINRA is looking to organizations such as UBS and HSBC Private Banking, as well as high-level executives in Youku and Tudou, because of suspicious spikes in the trading of Tudou's shares before the announcement of the merger in March was issued.

The U.S. agency did state the investigation is part of the procedure required for public companies and does not mean the people or organizations currently being investigated are guilty of insider trading.

An unnamed investor told Sina Tech the investigation would not affect Youku and Tudou's merger . Even if the people or organizations in the list were found to be guilty of insider trading, the U.S. Securities and Exchange Commission (SEC) will punish only those involved without involving the company.

Topics: Tech Industry, China

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The only journalist in the team without a Western name, Yun Qing hails from the mountainy Malaysian state, Sabah. She currently covers the hardware and networking beats, as well as everything else that falls into her lap, at ZDNet Asia. Her RSS feed includes tech news sites and most of the Cheezburger network. She is also a cheapskate mas... Full Bio

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