The Securities and Exchange Commission announced Tuesday that it had filed civil fraud charges against CyberKey and its chief executive, James Plant, in federal court in Philadelphia. In addition, federal prosecutors on March 12 filed a criminal complaint against Plant, who was arrested by FBI agents the following day in St. George on charges of securities fraud.

The company and Plant sold unregistered stock while falsely touting the purported Homeland Security contract, the SEC said. The sales, starting in November 2005, helped CyberKey and Plant reap at least $1.5 million, the agency said.

''What makes this particularly troubling is that the company and CEO preyed on people's fear of terrorism to try and make a profit,'' said John Reed Stark, an attorney overseeing the investigation.

The SEC suspended trading of CyberKey's stock for 10 days last month, saying it wanted to examine statements the company made about the Homeland Security contract and other accounting issues. The agency's suit seeks to make the company and Plant pay unspecified fines and forfeit allegedly ill-gotten gains.

CyberKey's products include flash-memory drives and safes that restrict access by requiring fingerprint identification. Last month, the company tried unsuccessfully to pitch its products on ABC's ''Good Morning America,'' according to its news releases.

Plant's attorney, Gary Krupkin, said he hadn't seen details of the charges and had no immediate comment. After Plant was arrested, he was released a few hours later and a date for a court appearance is being worked out with the U.S. attorney's office in Philadelphia, Krupkin said.

A lawyer for CyberKey didn't return phone messages seeking comment.

An internal investigation showed a ''certain company official'' used improper accounting and reporting procedures while handling ''critical company contracts,'' CyberKey said March 15. The company said an accounting firm will review its finances for the past three years.