Apollo Executives Adopt Stock Trading Plan In Wake Of Probe
November 01 2010 - 10:16AM
Dow Jones News
Two top executives at Apollo Group Inc. (APOL) have adopted
prearranged stock trading plans, giving up discretion over when
they sell shares as the for-profit college operator faces scrutiny
over its insider trading policies.
Executive Chairman John Sperling, founder of Apollo, and his son
Vice Chairman Peter Sperling announced in a Securities and Exchange
Commission filing Monday that they adopted 10b5-1 plans, under
which sale of their stock will be done via a broker in prearranged
transactions based on pricing or timing.
The Sperlings were the subjects of a New York Times article
Sunday tying certain of their stock sales to specific developments
in a U.S. Department of Education investigation into financial aid
practices at Apollo's University of Phoenix. According to that
article, the Sperlings sold nearly 1.1 million shares in late
January 2009, shortly after the department notified the company of
student complaints about disbursements of student loans. The
article said they sold another 2.1 million shares in July 2009,
soon after the company may have received a draft of the
department's findings.
A representative for Apollo wasn't immediately available for
comment.
Oct. 26, Apollo disclosed that the SEC has asked the company for
information on its insider-trading policies and procedures, as well
as a chronology of its internal processing and availability of
information regarding the Department of Education's review. The SEC
launched an informal inquiry into Apollo last fall, first asking
for information on the company's revenue recognition practices.
An SEC representative declined to comment.
BMO Capital Markets analyst Jeff Silber said in a client note
early Monday the move by the Sperlings is a positive one, as it
"can hopefully lessen any expected controversy over future insider
sales."
-By Melissa Korn, Dow Jones Newswires; 212-416-2271;
melissa.korn@dowjones.com
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