Southern District of New York Vacates Insider Trading Guilty Plea Based on Insufficient Personal Benefit Evidence Under United States v. Newman (Lexology)
On June 21, 2019, in United States v. Lee,1 Judge Paul G. Gardephe of the U.S. District Court for the Southern District of New York issued an order vacating the guilty plea of a former investment portfolio analyst, Richard Lee, to charges of insider trading based on confidential information obtained from an investment research firm that, in turn, received the information from company insiders. Judge Gardephe explained that, after Lee’s guilty plea in 2013, the Second Circuit clarified in United States v. Newman that a remote tippee such as Lee (that is, someone multiple steps removed for the source, or tipper, of the confidential information) only could be held liable for insider trading if (a) the tipper received a “personal benefit” for disclosing the confidential information and (b) the defendant knew that the information was confidential and the tipper received a personal benefit. Because no evidence that Lee knew of any personal benefit received by the tipper was before the court at the time of his plea, Judge Gardephe held that his guilty plea was insufficient under Rule 11 of the Federal Rules of Criminal Procedure.
Monday 7/1 Insider Buying Report: ARQL, MAC (Nasdaq.com)
On Thursday, ArQule’s Director, Ran Nussbaum, made a $3M buy of ARQL, purchasing 307,692 shares at a cost of $9.75 a piece. So far Nussbaum is in the green, up about 16.4% on their buy based on today’s trading high of $11.35. ArQule is trading off about 0.4% on the day Monday. Before this latest buy, Nussbaum made one other purchase in the past year, buying $999,999 shares for a cost of $5.50 a piece. And on Wednesday, Director Andrea M. Stephen bought $649,882 worth of Macerich, buying 20,000 shares at a cost of $32.49 each. Before this latest buy, Stephen made one other buy in the past twelve months, purchasing $700,300 shares for a cost of $35.02 a piece. Macerich is trading off about 3.9% on the day Monday.
What Did This CEO Just Do with Personal Shares of Century Communities (NYSE: CCS)? (Analyst Ratings)
Today, the Co-CEO, President of Century Communities (CCS), Robert Francescon, sold shares of CCS for $2.61M. Following Robert Francescon’s last CCS Sell transaction on September 09, 2016, the stock climbed by 6.8%. Based on Century Communities’ latest earnings report for the quarter ending March 31, the company posted quarterly revenue of $533 million and quarterly net profit of $17.12 million. In comparison, last year the company earned revenue of $398 million and had a net profit of $19.97 million. CCS’s market cap is $795.5M and the company has a P/E ratio of 8.67. Currently, Century Communities has an average volume of 631.6K.
Notable Insider Buys This Past Week: AbbVie, MGM and More (Benzinga)
MGM Resorts International: MGM 0.82% had a director continue to make indirect share purchases this past week. At $27.31 to $28.00 apiece, the more than 488,600 shares acquired most recently totaled almost $13.62 million. Note that these purchases were pursuant to a Rule 10b5-1 trading plan and continued a buying streak that began in early June.
Ex-Equifax Executive Sent to Jail for Insider Trading After Breach (WeLiveSecurity.com)
The Equifax debacle is in the news again, as a former executive of one of the firm’s business units was sentenced to four months in prison last week for capitalizing on early knowledge of the massive security incident two years ago, according to a press release by the US Department of Justice (DOJ). Jun Ying, the former Chief Information Officer (CIO) of Equifax’s US Information Solutions division, pled guilty back in March to selling his shares in the credit bureau. He admitted to dumping his stock after becoming aware of the breach but before it was disclosed a week and a half later.
Insider Trading: Sebi Slaps Rs 1.25 Crore Fine on Former MCX Director Hariharan Vaidyalingam (Outlook India)
New Delhi, Jul 1 Markets regulator Sebi has imposed a fine of Rs 1.25 crore on former MCX director Hariharan Vaidyalingam for insider trading. “…it has been established in the present case that the Noticee (Hariharan) being an insider sold the shares of MCX when in possession of the UPSI and violated the provisions of the Sebi PIT (Prohibition of Insider Trading) Regulations,” the regulator said while imposing the penalty on Hariharan. As per the Sebi order, Hariharan was a non-executive non-independent director on the board of MCX (Multi Commodity Exchange) during April 2002 to June 2012 and worked as an employee of FTIL (Financial Technologies India Limited) from January 2001 to June 2011.
