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Arbitron Execs Quizzed on Possible Insider Trading
New York Attorney General Andrew Cuomo is investigating whether Arbitron directors may have profited by selling around $8m worth of shares just before the company announced the delay of its Portable People Meter (PPM) rollout last November.
Shares in the ratings giant fell 15% in one day following the announcement.
Cuomo is already investigating the accuracy of Arbitron's audience estimates, which the Association of Hispanic Advertising Agencies and a group of minority radio broadcasters say do not adequately represent African-Americans and Hispanics in the US.
This new investigation focuses on seven Arbitron executives who sold shares in the time leading up to the announcement of the PPM delay.
According to a report in the Wall Street Journal, during the period between September and November last year, CEO Stephen Morris sold c$300,000 a month, but public filings suggest the sales were based on an existing stock-sale plan.
In addition, Pierre Bouvard, President of Sales and Marketing, reportedly sold shares valued at more than $2m in October and November 2007, and about $90,000 in September. Owen Charlebois, President of Research and Development, sold roughly $1.5m in stock in October, while EVP Linda Dupree sold roughly $2m in stock during October and November.
'We have begun a review of stock sales made before the PPM delay announcement in November 2007,' Cuomo spokesman Alex Detrick stated. 'The review is in its early stages and any allegations of insider trading should be taken as only that - just allegations. It remains to be seen where the facts will lead.'
Arbitron spokesman Thom Mocarsky said that Arbitron is cooperating with this inquiry, but declined to identify which other Arbitron executives are under investigation.
Web site: www.arbitron.com .
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