By Bob Tita and Jacob Bunge Of DOW JONES NEWSWIRES CHICAGO -(Dow Jones)- A federal judge on Thursday extended a freeze on the assets of two men accused of insider trading related to the takeover of Canadian fertilizer company Potash Corp. of Saskatchewan Inc (POT, POT.T). The continuation of the temporary restraining order against the pair runs until Sept. 2 when another hearing is scheduled in front of U.S. Judge Marvin Aspen. The restraining order includes an asset freeze and prohibits the defendants from engaging in any activity that would jeopardize evidence in the case. Juan Jose Fernandez Garcia, a former Banco Santander SA (STD, SAN.MC) analyst based in Madrid, and Luis Martin Caro Sanchez, also of Madrid, on Tuesday were accused by U.S. market regulators of pocketing nearly $1.1 million via options trades in advance of an offer made for Potash last week. Fernandez Garcia on Wednesday was suspended from his job with the Spanish bank, which is helping to fund a $38.6 billion offer for Potash made by Anglo-Australian mining company BHP Billiton Plc (BHP, BLT.LN). The Securities and Exchange Commission alleged that Fernandez Garcia had access to information or people who knew about the deal, and bought options contracts that paid $576,000 after BHP offered $130 per share for Potash Corp. The government said neither man had owned Potash stock or options prior to early August and had engaged in limited options trading through their accounts with Interactive Brokers Group (IBKR). Caro Sanchez, whose relationship with Fernandez Garcia remains unclear, made nearly $497,000 in illegal profits in a similar manner, according to the SEC. Caro Sanchez appeared at a hearing Thursday in U.S. District Court in Chicago without an attorney. A Spanish speaker from the government explained the proceedings to Sanchez, who has limited English-language skills. Caro Sanchez declined to comment on the case following the hearing. Fernandez Garcia was not present. Because the alleged transactions took place on U.S. markets, the case is being heard here. An attorney for the SEC, James Lundy, declined comment. -By Jacob Bunge, Dow Jones Newswires; (312) 750 4117; jacob.bunge@dowjones.com
