Employee of Perot Affiliate Charged With Insider Trades on Takeover Talks
As posted in the Wall Street Journal today, 09/24/09.
http://online.wsj.com/article/SB125374874441435751.html#mod=WSJ_hpp_LEFTWhatsNewsCollection
Should an employee of a company be prosecuted for purchasing and selling stock based upon a guess that the company will be taken over or merge with another?
From my experience as an employee within several different large organizations, when the “higher-ups” had meetings regarding reorganization or such, we “peons” were the last to know and were not informed, even on a managerial level, until the transaction was a “done deal.” This said, could a person speculate a prospective deal and act accordingly without truly receiving first-hand knowledge? Perhaps, yes. Likely, doubtful.
Someone, somewhere would have had to have raised a flag in order for Reza Saleh to have considered and followed-through with such a high-risk endeavor, if the information had not yet been released to the public.
I applaud the SEC for the action which they took and hope tht Reza Saleh is prosecuted accordingly.
Subscribe to:
Post Comments (Atom)
Working at a publicly traded company, I am not allowed to use any information I have about our profits or prospects to buy or sell our stock. If this man bought Perot stock, he would have been well informed of his responsibilities regarding that stock ownership and would know full well the consequences of selling based on that potential Dell transaction. He should be prosecuted because he is guilty of violating insider trading laws if he knew about Dell coming in.
ReplyDelete