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When most investors hear about insider trading charges being filed by the Securities and Exchange Commission, they probably think of someone profiting from leaked merger news. They probably are not imagining that the insider trading was in Peru.

The Securities and Exchange Commission (SEC) has now charged two lawyers and a brokerage firm manager in Peru with insider trading. Their alleged insider trading was prior to the merger of two mining companies.

Sometimes the real news is more entertaining than news you might think was otherwise made up. The SEC statement shows that this complaint seeks disgorgement of ill-gotten gains, as well as interest and penalties among other things.

Andrew M. Calamari, Director of the SEC’s New York Regional Office, said:

As alleged in our complaint, Coppero breached his duty to his employer by tipping Castro and Carrion in advance of any public announcement about HudBay’s impending tender offer. Try as they might, overseas traders shouldn’t presume they can cover their tracks to avoid detection and scrutiny from U.S. law enforcement when they violate insider trading laws.

Wednesday’s SEC reporting said:

The SEC alleges that Nino Coppero del Valle, who worked at Canadian-based HudBay Minerals Inc., tipped his close friend and fellow attorney Julio Antonio Castro Roca with material nonpublic information about a tender offer his company submitted to acquire the shares of Arizona-based Augusta Resource Corp.  Castro allegedly traded on the inside information through a brokerage account held by a shell company he set up in the British Virgin Islands in an attempt to avoid having the trades traced back to him and Coppero.  According to the SEC’s complaint, Castro and Coppero made more than $112,000 in illicit profits from these unlawful trades.

The SEC further alleges that Coppero tipped an acquaintance Ricardo Carrion when seeking his advice about making illegal trades untraceable.  According to the SEC’s complaint, Carrion exploited the inside information and caused his brokerage firm to purchase Augusta Resource shares ahead of the tender offer announcement.  Carrion’s firm obtained $73,000 in alleged profits.