Next generation “SaaS” Securities and Exchange Commission (SEC) regulatory disclosure service iCrowdNewswire has launched an…
A U.S. appeals court is set hear a case whose outcome could make it harder for the government to prosecute insider trading and potentially jeopardize several high-profile guilty verdicts, including that of SAC Capital Advisors portfolio manager Michael Steinberg.
The question facing the 2nd U.S. Circuit Court of Appeals in New York on Tuesday is one that has divided lower court judges: whether to be convicted of insider trading, the recipient of non-public information must know that the source of the tip benefited from the disclosure.
In 1983, the US Supreme court held that a “tippee” can only be found to have engaged in insider trading if the tipper benefited from the disclosure. The case in question today highlights the issue of whether the prosecutors must show the tippee knew of the tipper’s benefit, whether financial or non-monetary. The results of the verdict will answer the question of whether prosecutors are trying to stretch securities law too far and will give guidance to the business community to protect itself from potential insider trading violations. For full access to the article, please click here.
What are some of your thoughts on insider trading laws?