Federal regulators have charged billionaire internet entrepreneur Mark Cuban with insider trading for allegedly using confidential information on a stock sale to avoid more than $750,000 in losses.

The Securities and Exchange Commission filed a civil lawsuit against Mr Cuban in a federal court in Dallas. The agency alleged that Mr Cuban was invited to take part in a stock offering by Mamma.com Inc. after he agreed to keep the information private. The SEC said Mr Cuban knew the shares would be sold below the current market price, and a few hours after receiving the information, told his broker to sell all shares in the company. Mamma.com, now renamed Copernic Inc, is a leading software development company specializing in internet, desktop and mobile search.

Mr Cuban, the outspoken and controversial owner of the Dallas Mavericks basketball team, built his fortune largely through the same of Broadcast.com to Yahoo for $4.6 billion in 1999. The Guinness Book of Records listed him with the "largest single e-commerce transaction," after paying $40 million for his Gulfstream V jet in October 1999. He is currently bidding to acquire the Chicago Cubs baseball team. He is the chairman of Chairman of HDNet, an HDTV cable network, and in 2007 he was estimated to have a net worth of $2.8 billion.

The Commission's complaint alleges that in June 2004, Mamma.com Inc. invited Mr Cuban to participate in the stock offering and that he knew it would send the share price down.

Within hours of receiving this information, according to the complaint, Mr Cuban called his broker and instructed him to sell his entire position in the company. When the offering was publicly announced, Mamma.com's stock price opened at $11.89, down $1.215 or 9.3 per cent from the prior day's closing price of $13.105. According to the complaint, Mr Cuban avoided losses in excess of $750,000.

"As we allege in the complaint, Mamma.com entrusted Mr. Cuban with nonpublic information after he promised to keep the information confidential. Less than four hours later, Mr. Cuban betrayed that trust by placing an order to sell all of his shares," said Scott W.

Friestad, Deputy Director of the SEC's Division of Enforcement. "It is fundamentally unfair for someone to use access to nonpublic information to improperly gain an edge on the market."

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