UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC

Litigation Release No. 17279 / December 19, 2001

SECURITIES AND EXCHANGE COMMISSION v. SEAN R. PRICE AND BENJAMIN J. MALDONADO III Case No. 1:01CV02624 (D.D.C.) (ESH) (filed December 19, 2001)

SEC CHARGES SENIOR VICE PRESIDENT OF BALTIMORE-BASED SAFENET, INC. AND FORMER MERRILL LYNCH STOCKBROKER WITH INSIDER TRADING

On December 19, 2001, the Securities and Exchange Commission filed a settled insider trading action in federal court in Washington, D.C. against Sean R. Price, a Senior Vice President at Safenet, Inc. (formerly known as Information Resource Engineering, Inc., or IRE), and Benjamin J. Maldonado III, a former stockbroker in the Washington, DC office of Merrill Lynch, Pierce, Fenner & Smith, Inc. Safenet is an Internet security company based in Baltimore, Maryland, and its stock is traded on the NASDAQ National Market under the symbol SFNT. Without admitting or denying the allegations in the Complaint, Maldonado and Price consented to the entry of a final judgment that would permanently enjoin each of them from violating Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Maldonado will disgorge $38,489.80 in losses avoided, plus prejudgment interest, and will pay a civil penalty of $38,489.80. Price will pay a civil penalty of $38,489.80 based on Maldonado's avoided losses.

The SEC's Complaint alleges that Price tipped Maldonado in advance of IRE's October 4, 1999 announcement that the company expected to report third quarter financial results below analysts' expectations. According to the Complaint, during the week immediately before the announcement, Price tipped Maldonado with confidential information about IRE's adverse financial results, and Maldonado then sold 29,500 shares of IRE that Maldonado and his family members owned. Price and Maldonado have known each other since their early teenage years, and Maldonado was the stockbroker assigned to Price's accounts at Merrill Lynch. As a result of his illegal sales, Maldonado and his family avoided losses of more than $38,000.

As part of the settlement, Maldonado also consented, without admitting or denying the Commission's findings, to the entry of an administrative order pursuant to Section 15(b)(6) of the Securities Exchange Act of 1934 barring him from associating with any broker or dealer with a right to reapply after five years.

The Commission acknowledges the assistance of the NASD Regulation, Inc. in this matter.

SEC Complaint in this matter.