One of the cases the Securities and Exchange Commission filed today against alleged insider traders just leaves you wondering where have people been the past few years. This is the case involving a Disney administrative assistant who apparently had access to press releases before they were distributed – and in particular, earnings releases. So, she agreed to pass them along to her boyfriend who ahead of time would contact 20 or more hedge funds to see if they were interested on trading on inside information. He contacted them via anonymous letters. One of the funny things about the SEC press release on this is that it talks about how 20-plus hedge funds were sent the letter but how only several of them contacted the SEC. Hats off to those several but what about the others?
The SEC refers to this as a brazen insider trader case. I suppose one could find stronger words: maybe dumb? Glad the Feds nailed these guys but if you want a good read about “Amateur Hour Comes To Wall Street,” well, here it is. See the SEC complaint and press release by clicking here.
Posted by Rick Stine
on March 24, 2010
, Securities & Exchange Commission
While it’s true that for many ad people the adage “all news is good news” works as a way to keep a brand name out in front of people, you have to figure the folks at Macy’s aren’t crazy about this publicity.
As part of an insider trading case today, the SEC charged that one of the no-good-doers (alleged, of course), would send coded email messages to a fellow alleged no-good-doer. The tip about illegal stock buying opportunities was caught up in a code of whether gifts were bought at the Macy’s bridal registry. “Happy to talk about sales items,” one of the emails read.
Somehow the SEC saw through this – was in because that the half dozen or so people nabbed in the ring were Russian and it was presumed if they were dealing in bridal registrys it would be at Tiffany, not Macy’s?
Here’s the SEC complaint.
Posted by Gabriella Stern
on December 21, 2009
“My daughter is innocent and that is what you will be printing,” said Gloria Chiesi, Danielle Chiesi’s mother, after today’s U.S. District Court arraignment hearing at which Danielle pleaded not guilty to insider-trading charges. Mother Chiesi continued: “God borrowed my body and gave me this girl. She’s my angel.” Check out DJN colleague Kelly Nolan’s coverage.
Hewlett Packard became the latest tech company to put some of its cash to work today by offering to buy networking gear-maker 3 Com for $2.7 billion. There’s obviously an interesting H-P strategy story in all of this but what is more fascinating to me is what the headline on this blog item asks. Hours before the deal was announced, there was very unusual trading in the stock options of 3 Com. As Newswires reporter Tennille Tracy reports, a days work in 3 Com options results in a few hundred contracts traded daily. Today, there were close to 8,000 traded. What makes this kind of trading even more remarkable is that it happens against the backdrop of a very high profile federal investigation into hedge funds brokering inside information with a network of paid tipseters that seems to be fingering some pretty high profile players. Maybe just a coincidence but it doesn’t seem like it. Even if you innocently heard a rumor today about H-P and 3 Com, would you risk trading on it given what the Feds are up to? The more things change, the more they stay the same…
Raj Rajaratnam, the billionaire hedge fund manager arrested Friday and charged with insider trading, is apparently connected to a case in his native Sri Lanka that involves money transfers that should have been reported to the local government.
Rajaratnam, with the help of a Sri Lankan Parliament member, transferred $1 million from Galleon (his hedge fund) into an account of Nexia Corporate Consultants in late 2006, according to a Sept. 26, 2009, article in the Daily Mirror of Sri Lanka. Rajaratnam then followed with his own $2 million transfer in early 2007, according to the article. The money was to be used to buy shares of Union Bank of Colombo, the article said.