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1996-06-04 - Re: Saw this on CNN: Anonymous Stock tips over IRC as bad???

Header Data

From: “Perry E. Metzger” <perry@piermont.com>
To: Jeff Barber <jeffb@sware.com>
Message Hash: b868649b62c30c34a3299487c623cbd7ba41fbc4816d355da65a748a794a0aa3
Message ID: <199606032029.QAA05821@jekyll.piermont.com>
Reply To: <199606031918.PAA15670@jafar.sware.com>
UTC Datetime: 1996-06-04 01:41:49 UTC
Raw Date: Tue, 4 Jun 1996 09:41:49 +0800

Raw message

From: "Perry E. Metzger" <perry@piermont.com>
Date: Tue, 4 Jun 1996 09:41:49 +0800
To: Jeff Barber <jeffb@sware.com>
Subject: Re: Saw this on CNN: Anonymous Stock tips over IRC as bad???
In-Reply-To: <199606031918.PAA15670@jafar.sware.com>
Message-ID: <199606032029.QAA05821@jekyll.piermont.com>
MIME-Version: 1.0
Content-Type: text/plain



Jeff Barber writes:
> I trust it won't stun you to find that many, many large and even small
> corporations -- including my current employer [*NOT* SecureWare, BTW,
> despite the email address] -- actually encourage their employees to buy
> stock by offering stock purchase plans as a benefit of employment.

Yup. Indeed, its perfectly legal and even common to trade in the stock
of your own company, even if you are a corporate officer. HOWEVER,
that doesn't mean that you are safe against insider trading charges.

> So perhaps Tim over-simplified by saying that there were no limits on
> what ordinary employees could do.  OTOH, it seems that Perry also
> over-simplified by flatly stating that Tim's trades while an Intel
> employee were "illegal".

First of all, I never said that Tim's trades were illegal -- indeed, I
never mentioned Tim except to say that following his advice didn't
seem like a particularly safe course to take. Second of all, I can't
comment on whether Tim's trades were within the letter of the law or
not. Indeed, it would be difficult even if one knew all the
circumstances since the definition of "material non-public
information" is so hard to pin down.

The point of all this was not that one shouldn't participate in the
employee payroll stock purchase plan. The point was that a random
person on the street who gets told a 'hot tip' is probably subject to
the insider trading laws, never mind that he wasn't an employee or
what is conventionally thought to be an "insider".

Perry

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