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Mba - Introduction of Us Insider Trading

In:

Submitted By BrandonWu
Words 4596
Pages 19
Insider Trading: Education, Prevention, and Rule 10b5-1 Plans
Speaker: Bruce Brumberg, Esq. Editor-in-Chief, myStockOptions.com Producer, Think Twice videos, InsiderTradingVideos.com

Copyright © 2007, myStockPlan.com, Inc. Please do not distribute or copy without permission

Roadmap for Presentation
• Overview of various cases and interesting themes • Fundamentals of insider trading law • Compliance programs • Rule 10b5-1 trading plans • SEC investigations • Martha Stewart case: lessons and training

2

HEADING

Shares sold in cases of insider trading often come from option exercises or restricted stock vesting.

3

Accounting scandals/fraud intertwined with insider trading. Insider trading cases more interesting to juries and easier for prosecutors to explain. Did the CEO sell stock knowing his company could not make its earnings targets without improperly booking revenue?

4

The SEC detects and prosecutes even small-profit cases. $38,000 in profits by former CFO.

5

Criminal charges are now more likely. Justice Department and local US Attorneys interested in these cases. Ex-Countrywide execs get probation terms for insider trading
By ALEX VEIGA, AP Business Writer LOS ANGELES—November 26, 2007 Three former Countrywide Financial Corp. executives who pleaded guilty to criminal charges of insider trading were sentenced Monday to serve three years probation, the U.S. attorney's office said. They must also serve several hundred hours of community service and pay fines. In their plea agreements earlier this year, the executives admitted they used confidential data showing Countrywide would not meet Wall Street earnings projections for the third quarter of 2004. They then used the information to sell off their shares, to buy put options and, eventually, to short-sell the stock, in efforts to profit from a fall in the stock's price,

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