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Alaska Air CEO Faces Insider Trading Probe: Report

Thursday, 7 Oct 2010 | 6:34 PM ET

Shares of Alaska Air fell Thursday after investors learned the US Securities and Exchange Commission is investigating CEO William Ayer and hedge fund Donald Smith & Co. for insider trading activity connected to Puget Energy, Bloomberg reported.

Ayer was bullish on his airline when interviewed on the "Fast Money Halftime Report" on August 8. After Southwest Airlines announced its plans to acquire AirTran for $1.4 billion on Sept. 27, Alaska Airlines was talked about as a potential takeover candidate, noted CNBC's Melissa Lee.

Tick by Tick: Alaska Air
Alaska Air shares plunge on the CEO's trading probe report.

Alaska Air shares continued to fall in after-hours trading Thursday.

In a statement, Alaska Air pointed out that Bloomberg's story did not accuse Ayer or Smith of any wrongdoing. "I never provided any material non-public information about Puget Energy to Donald Smith & Co., or anyone else," Ayer told Bloomberg.

Marc Langland, the lead independent director on Alaska Air's board, said: "The Alaska Air Group board of directors has full confidence in Bill and his high ethical standards."

Watch the video to see the Aug. 8 interview with William Ayer—it starts at 1:00.

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Trader disclosure: On Oct. 7, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (APA), (AAPL), (IBM), (EOG), (HES), (OIH), (OXY), (ORCL), (RSH), (UPL), (SU), (VRTS), (XBI), (RIG), (VRTS), (FTO), (PEP), (JOYG), (C); Terranova Is Long (GLD) Puts; Terranova Is Long (FCX) Puts; Terranova Is Long (JOYG) Puts; Terranova Is Long (OIH) Puts; Terranova Is Long (FFIV) Puts; Karen Finerman owns (JCG); Karen Finerman owns (GYMB); Karen Finerman owns (AEO); Karen Finerman is short (ANF); Karen Finerman's firm is long (BP); Karen Finerman's firm is long (YUM); Karen Finerman's firm is long (GENZ); Karen Finerman's firm is long S&P 500 Puts; Karen Finerman's firm is long Russel 2000 Puts; Karen Finerman's firm is short (JR); Karen Finerman's firm is short (MDY); Karen Finerman's firm is short (IWM); Karen Finerman's firm is short (SPY); Cortes Is Short (XLF); Cortes Is Short (BAC); Cortes Is Short (BIDU); Cortes Is Short Euro; Cortes Is Short Mexican Peso; Cortes Is Long German Bonds; Pete Najarian is long (AA) Calls; Pete Najarian is long (MAR) Calls; Pete Najarian is long (YUM) Calls; Pete Najarian is long (AKAM) Calls; Pete Najarian is long (BP) Calls; Pete Najarian is long (BEXP) Calls; Pete Najarian owns (BRCD); Jon Najarian Owns (BKE); Jon Najarian Owns (ZUMZ); Jon Najarian Owns (ADBE), Is long (ADBE) Call Spreads; Jon Najarian Owns (DCTH), Is long (DCTH) Call Spreads; Jon Najarian Owns (ANF), Is Short (ANF) Calls; Jon Najarian Owns (LTD), Is Short (LTD) Calls; Jon Najarian Owns (AEO), Is Short (AEO) Calls; Jon Najarian Owns (AA) Call Spreads; Jon Najarian Owns (SVNT) Call Spreads; Jon Najarian Owns (BEXP) Calls; Jon Najarian Owns (JCP) Calls

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Citigroup Global Markets Or Affiliates Expects To Receive/Seek Investment Banking Compensation From (HD), (KR), (WMT) In Next 3 Months
Citigroup Global Markets Or Affiliate Received Non-Investment Banking Compensation From (HD), (JCP), (KSS), (KR), (M), (SWY), (SVU), (TGT), (WAG), (WMT), (COST) In Past 12 Months
(DG), (HD), (KR), (SKS), (TGT), (WMT) Are Or In Past 12 Months Were Investment Banking Clients Of Citigroup Global Markets
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(HD), (JCP), (KSS), (KR), (M), (SWY), (SVU), (TGT), (WAG), (WMT), (COST) Are Or In Past 12 Months Were Non-Investment Banking Clients Of Citigroup Global Markets (Non-Securitites-Related Services)
Citigroup Global Markets Or Affiliate Received Compensation From (DG) In Past 12 Months
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