A federal judge yesterday froze more than $5 million in profits the Securities and Exchange Commission claims resulted from the illegal use of insider information about the takeover of Santa Fe International Corp. by the state-owned Kuwait Petroleum Corp.

Hours later the SEC named one of the individuals suspected in the profits scheme--Faisal Massoud Fuhaid, a resident of Kuwait and individual investor in Santa Fe. The SEC also indicated that its investigation covers an additional eight investment accounts in Kuwait and six more in London.

An attorney for the Kuwait Petroleum Corp. said that Fuhaid has no connection with the government-controlled firm, and a Santa Fe official said he had never heard the name. Fuhaid is known at the Kuwaiti Embassy, but was described as "a private businessman, not one of the heavies."

U.S. District Court Judge William Conner in New York stepped into the investigation yesterday morning at the federal government's request to prevent the transfer of funds out of the country and out of the government's legal reach.

Named in the original SEC complaint were several Swiss banks and brokerage firms that handled the transactions now under investigation. The identity of some of those investors is apparently cloaked in the secrecy of Swiss bank accounts.

The SEC action appears to be part of a new government effort to make sure that foreign accounts are not used as a front for illegal investor activity.

The SEC charged in its request for a temporary restraining order that these unknown investors realized a potential profit of approximately $5.2 million on an initial investment of $344,691 used to purchase Santa Fe stock and stock options in advance of the Oct. 5 announcement of the sale.

The SEC is investigating purchases of approximately 35,000 shares of Santa Fe stock and 3,000 option contracts on an additional 300,000 shares. The option contracts were priced so that they appeared practically worthless at the time of their purchase, but they became extremely valuable after the announcement of the sale, the SEC complaint said.

"Certain persons, whose identities are being withheld by their agents on a claim of Swiss bank secrecy, purchased Santa Fe securities in significant quantities based on material, non-public information," the SEC said in papers filed in U.S. District Court for the Southern District of New York. The SEC said its case rests on, among other things, "the amount, timing and type of transactions effected and upon the attempt of the purchasers to remain secret and unknown."

By the end of the day at least some of the mystery surrounding the identity of the purchasers appeared to be dissolving. The SEC named Fuhaid, who apparently purchased 500 option contracts, and the court amended its temporary restraining order to freeze his accounts at Merrill Lynch. The judge also ordered Merrill Lynch to provide 48-hour notice of any attempt to transfer money from the additional Kuwaiti and London accounts.

The customers for those accounts were unnamed, but the action indicated that the SEC knows the identity of the individual investors.

The Kuwaiti firm and Santa Fe International, a major California-based oil drilling contractor, announced earlier this month they had agreed to the sale for $2.5 billion. The merger has been controversial because of concerns in Congress and elsewhere of the impact of ownership of the American company by Kuwait, one of the richest members of the Organization of Petroleum Exporting Countries.

The SEC complaint portrayed the activity in Santa Fe stock and options before the sale was announced and trading suspended as a suspicious flurry of trades. The circumstanses suggest that the purchasers of the options and stock were "insiders or tippees of insiders who were privy to confidential information concerning Santa Fe's merger discussions, proposals and negotiations with KPC," the SEC said.

Yesterday's court order bars the defendants from destroying records about the transactions and allows the SEC to move forward more rapidly with its investigation.

"Throughout 95 percent of our discussions, the persons who knew about them could be counted on the fingers of both hands with several fingers left over," said James R. Ukropina, senior vice president and general counsel to Santa Fe. He said both firms had concluded from their investigations that no one from the companies had been involved. An attorney for the Kuwaiti firm said the same thing.

In a related development yesterday, Rep. Benjamin S. Rosenthal (D-N.Y.) asked Federal Trade Commission Chairman James C. Miller to explain gaps in the merger report filed with the FTC by Santa Fe and the Kuwaiti firm. Among other things, Rosenthal noted that KPC included neither an annual audit report nor a balance sheet, although it has indicated it will do so. The FTC determines possible anti-competitive effects of mergers based on such reports.