Thomas C. Reed, who joined the White House National Security Council staff after settling a charge of insider stock trading with the government, backdated and signed other people's names on brokerage forms to help several associates sell the stock options, according to Common Cause magazine.
The Securities and Exchange Commission charged in 1981 that Reed used inside information in parlaying a $3,125 investment on stock options into $427,000 in profits.
Reed bought the options in Amax Corp. after talking to his father, a member of the Amax board of directors, who knew that Standard Oil of California was about to make an offer to buy the company. The offer dramatically increased the value of Amax stock.
Reed, a former secretary of the Air Force, settled the SEC case by repaying the $427,000 without admitting or denying the charges. He called the investment "a very small roll of the dice," and insisted that he didn't discuss the merger when he spoke to his father twice on the morning he bought the options.
National security affairs adviser William P. Clark hired Reed as a temporary consultant last February, and then named him special assistant to the president.
Reed said he bought the stock options as gifts for other employes of his California company and their spouses. But Common Cause reported that, according to SEC documents, Reed was unable to locate several of his associates to sign brokerage forms to sell the options at a profit.
Instead, the magazine said, Reed "filled out the forms himself--in some cases making up what he didn't know, signing the forms with their names and backdating the forms to . . . two days before Reed himself had bought the options."
Reed did not return telephone calls yesterday.