Olaf
Years ago
Mark Cuban charged with insider trading
For $750,000 it hardly seems worth it
http://linky.com.au/y0yuo
Olaf
Years ago
For $750,000 it hardly seems worth it
http://linky.com.au/y0yuo
Isaac
Years ago
Apparently the company in question (mamma.com) shared information confidentially with Cuban and he supposedly made a trade based on that information. You're not supposed to gain an advantage in the market through non-public info.
Cuban has a brief post on his site in response. The comments from readers seem to fall into three rough categories ('my hero can do no wrong', 'still like you, but wear the penalty', and 'suffer in your jocks').
uh oh
Years ago
can you say martha Stewart.. If he's guilty thats jail time. it's such a stupid law by the way. Who exaxtly is the victim in this sort of crime? Seriously
XY
Years ago
Uh oh, the 'poor victim' is the person who buys the overvalued shares from, or sells the undervalued shares to, the insider, not knowing what the insider knows, whilst the insider makes a tidy profit from the information they have received arising from their special relationship of confidentiality with the company.
It certainly sounds like a crime to me. It aint murder, but it is a profiteering racket.
It applies to publicly listed companies where the public is supposed to be able to buy and sell on an even playing field with all other prospective purchasers. Insider trading is a direct violation of the principles of listed stocks, and people involved in that marked should and do know better.
TR
Years ago
It's not jail time. It's a civil crime, not a criminal crime which means all he will be doing is writing a fat check as punishment.
Stewart went to jail for lying to the authorities.
uh oh
Years ago
XY, understood but keep in mind that the stock market in America is already run like a high stakes casino anyway and not too long ago the same lawmakers saw this sort of relationship as a perk of having a certain level of involvement within a company.
XY
Years ago
But times have changed. The legislature once used to turn a blind eye to most comsumer protection issues. Now most western countries have all sorts of consumer protection legislation: false advertising, misleading and deceptive conduct, fair trading, cartel behaviour etc. How is insider trading in any way fair business conduct?
If anything, Cuban could perhaps feel hard done by because he is one of the few caught out. But 'everyone else does it' has never been a very good defence. But if the statements in the article are correct, Cuban knew exactly what he was doing.
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