InterMune Inc. had good news to announce about its lung disease drug.

On Dec. 17, 2010, the California biotechnology firm said European Union regulators had recommended approval of the medicine for sale in Europe. Its shares rose 144 percent, while some options to buy the stock gained more than 500 percent.

Six days later, lawyers for the Securities and Exchange Commission rushed into Manhattan federal court, claiming “unknown purchasers” used London accounts to buy 637 InterMune options contracts on U.S. exchanges days before the news. Regulators said they immediately suspected insider trading. While SEC lawyers didn’t know who bought the contracts, or where their tip came from, they persuaded a judge to freeze the accounts and block the sale of options worth as much as $912,000.

The agency soon figured out who was behind some of the InterMune trades. Within weeks, a lawyer for Michael Sarkesian, a Swiss citizen and ex-grain trader, came forward to say his client had bought 400 options. Sarkesian, who had traded through Quorne Ltd., a British Virgin Islands entity he managed for a relative, denied using inside tips. A year later, he agreed to return his profit on the trades and pay a $93,806 penalty.

The case is part of an increasing SEC focus on insider trading by overseas buyers of U.S.-traded securities, as seen in cases stretching from China to Lebanon to Switzerland. Since 2010, the agency filed three times as many emergency asset- freeze requests in such cases as in the prior two years. The regulator cited suspect trading patterns, typically before mergers or other market-moving news.

Significant Obstacles

Unlike domestic insider cases that include SEC suits and Justice Department prosecutions, overseas trading probes present significant obstacles to criminal charges. In only one recent case did the U.S. follow an SEC case with related charges, due in part to difficulties in obtaining evidence and extraditing foreign defendants. The SEC requested the government consider charges against overseas traders less frequently in such cases than in domestic probes, said one ex-assistant U.S. attorney.

“We had to evaluate the likelihood of bringing them to justice in the U.S.,” Christopher Garcia, who was chief of the Manhattan U.S. Attorney’s white-collar crime unit until February, said of the SEC’s referral of overseas cases to the Justice Department.

As a result, foreign insider traders, while at some risk of losing their money, face very little chance of going to prison.

“You will lose not only your profits but also your principal,” Peter Henning, a law professor at Wayne State University and former SEC lawyer, said in an interview. “But I haven’t seen any cases where people will be extradited.” Henning added, however, that “If you are identified” as trading on illegal tips, “you had better not come to the U.S.”