The U.S. Securities and Exchange Commission reports that a court issued an order freezing assets it alleges were involved with illegal insider trading ahead of the disclosure of News Corp.’s bid for Dow Jones.

The SEC said that the U.S. District Court for the Southern District of New York entered a Temporary Restraining Order freezing assets of two Hong Kong residents, Kan King Wong and Charlotte Ka On Wong Leung, held at a branch office of Merrill Lynch & Co. in Hong Kong. The commission’s complaint alleges that the defendants engaged in illegal insider trading. These allegations have not been proven.

According to the SEC’s complaint, the defendants purchased 415,000 shares of Dow Jones common stock in their Merrill Lynch accounts between April 13 and April 30, for approximately $US15 million. On May 1, Dow Jones stock price shot up 58% when it was disclosed publicly that News Corp. had made an offer to acquire the firm for $US60 per share — a substantial premium over the market price. On May 4, the defendants sold all 415,000 shares of Dow Jones common stock for a total of approximately $US23 million and a profit of approximately $US8 million, the SEC claims.

The commission is seeking permanent injunctive relief, disgorgement of any ill-gotten gains with prejudgment interest, and civil monetary penalties.