Egypt prosecutor charges Mubarak's sons with insider trading

Jan. 24, 2012: FILE - Alaa Mubarak, right, and Gamal Mubarak, left, sons of former Egyptian president Hosni Mubarak, arrive at the court house in Cairo, Egypt. (AP)

CAIRO – Hosni Mubarak's two sons, already in jail for more than a year and on trial, were charged with insider trading Wednesday in a new case against them.

A statement by the prosecutor-general's office carried on the official state news agency alleged the two, along with seven others, made millions of pounds in illicit gains from the sale of a bank.

Mubarak and his two sons, one-time heir apparent Gamal and wealthy businessman Alaa, are already on trial for separate charges of corruption. They have all been in prison since April 2011, two months after Mubarak was ousted in a popular uprising.

The prosecutor's statement alleged that Mubarak's sons and the seven other defendants made illegal gains of some 2 billion Egyptian pounds and that their actions violated central bank and stock market regulations. It said the nine conspired to buy a controlling 80 percent stake in the bank in 2006 without declaring their share to the stock market authority. They later traded those shares through closed funds and investment companies based abroad.

"They deliberately withheld this essential information on the sale of the bank from other traders in its shares to execute their criminal plot and violate the principles of transparency and equality between traders," said the statement. It did not specify the role of each of the nine defendants.

Gamal Mubarak was viewed by many as a corrupt politician who used his father's position to illegally amass a fortune while working with a coterie of regime-backed wealthy businessmen and powerful politicians to ensure that he succeeded his father.

Gamal rapidly climbed to the top of the ruling National Democratic Party and had become its de facto boss by the eve of his father's ouster 15 months ago, when he was effectively running Egypt's day-to-day affairs. At the time of the uprising, there was growing anxiety in Egypt that his succession was imminent and that anxiety is seen as one of the key sparks for the uprising that overthrew Mubarak.

Many of Gamal's closest allies are among some three dozen regime stalwarts in detention facing charges of corruption. Some of them have been convicted and sentenced to prison terms.

For the cases that were already in progress, a verdict is expected on June 2 against the father and the two sons.

Mubarak, 84, himself faces additional charges of complicity in the death of some 900 protesters during the uprising last year that ousted him. But his sons do not face those charges. The former leader could get the death penalty if convicted on the charges linked to killing protesters.

Mubarak stepped down in February last year after nearly three decades in power.

The prosecutor's statement said Gamal, 48, has unlawfully made a profit of nearly 500 million Egyptian pounds from the sale of the Watani Bank and that his brother Alaa, believed to be around 50, used insider information about the bank to reap an illegal profit of some 12 million Egyptian pounds.

Two of the seven men charged along with the Mubarak sons are chief executives at Hermes, one of the Middle East's top investment banks with branches in nine Arab nations. They are Yasser El-Malawny and Hassan Heikal, son of Mohammed Hassanein Heikal, Egypt's best known political writer and a longtime confidante of the late Egyptian leader Gamal Abdel-Nasser.

A date for the trial has yet to be announced and the seven other people charged in the case have been released on bail but are barred from leaving the country.