Price/Costco Exec Settles Inside-Trading Case With SEC

WASHINGTON - Richard Galanti, the chief financial officer of Kirkland-based Price/Costco Inc., agreed to pay $64,408 to settle insider-trading charges stemming from the 1991 merger between Office Club Inc. and Office Depot Inc., the Securities and Exchange Commission said.

The charges, outlined in a SEC complaint filed Wednesday in U.S. District Court in Washington, D.C., alleged that Galanti used inside information about Office Depot's plans to acquire Office Club to purchase 5,000 Office Club shares in November 1990. A month later, when the merger was announced, Galanti sold the stock for a profit of $26,875, the SEC alleged.

The agency alleged that Galanti received the inside information from Jack Seibald, an equity-research analyst at the time with Salomon Brothers, the investment bank that represented Office Club in the merger. Siebald wasn't immediately available for comment.

Without admitting or denying guilt, Galanti agreed to return his profits plus $10,658 in interest and to pay a civil penalty of $26,875. He also agreed not to violate the securities laws again.

"I am very pleased to have this behind me," said Galanti. He said he had no other comment on the SEC allegations.

Office Depot Inc. operates a chain of 420 office product warehouse stores nationwide.