Study Finds SEC Staff Sold Shares Before Cases Made Public
Source: Bloomberg News
People working for the U.S. Securities and Exchange Commission who owned stock in companies under investigation were more likely to sell shares than other investors in the months before the agency announced it was taking enforcement actions, according to a new academic paper.
SEC employees holding shares of five firms including JPMorgan Chase & Co. and General Electric Co. (GE) in 2010 and 2011 sold stock in 62 percent of the trades they initiated, compared with 50 percent among all the investors who traded those shares in that period, Emory University accounting professor Shivaram Rajgopal reports in the paper.
Rajgopal, who plans to present the work today at a University of Virginia accounting seminar, said in a telephone interview that while the analysis doesnt prove misconduct it points out a suspicious pattern.
It does suggest it is likely, or probable, that something is going on, he said.
Read more: http://www.bloomberg.com/news/2014-02-27/study-finds-sec-staff-sold-shares-before-settlements-made-public.html
Wolves guarding the hen house.
Common Sense Party
(14,139 posts)Feckless bunch of nincompoops.
riderinthestorm
(23,272 posts)Quelle surprise..... not
Fantastic Anarchist
(7,309 posts)aquart
(69,014 posts)Really they do.
Fantastic Anarchist
(7,309 posts)Too bad it can't happen where we have two sets of laws.
Some "poultry" are more equal than others.
aquart
(69,014 posts)There have ALWAYS been two sets of laws. "The price of freedom is eternal vigilance" and that has never changed.
BUT get our entitled darlings before a grand jury and lovely things can happen. White collar wolves prefer to plead rather than face that pissed off poultry jury.
Right now, Scott Walker has singing ex-employees. There's a jury on Christie's nasties. And at least one ex-employee begging for a plea deal so he can try out his tenor voice.
Pressure to indict our Wall Street creeps needs to be strong and steady. Voting out their favorite sons would be nice.
zazen
(2,978 posts)surrealAmerican
(11,368 posts)... in companies under investigation at all?
Fantastic Anarchist
(7,309 posts)elleng
(131,370 posts)My husband, deceased, worked for SEC for 20+ years. There are rules about how long between acquiring one may sell securities.
As to why allowed, we all invest, and the Fed Govt's Thrift Savings Plan encourages such, by matching purchases.
As to 'under investigation,' it would be difficult if not impossible to inform all SEC employees about all the investigations going on at any one time. There may be rules about those WORKING on an investigation.
markpkessinger
(8,409 posts)jsr
(7,712 posts)groundloop
(11,532 posts)If I found out that a company I owned stock in was in trouble I'd be hard pressed NOT to sell that stock and lose thousands of dollars. Not saying that it's right, but it would be damned hard to do nothing while your retirement savings took a big hit.
markpkessinger
(8,409 posts)Trading on "material non-public information" is a felony, regardless of how or where that information was obtained.
riderinthestorm
(23,272 posts)That would prevent them (for the most part since I'm not entirely convinced blind trusts actually work) from acting illegally.