Membership has its Privileges ... Right?
Well usually -- But not always ... just ask Martha.
Martha Stewart's conviction upheld
Appeals court affirms that the style maven lied to investigators about a well-timed sale of stock.
CNNMoney.com January 6, 2006
In 2004, Stewart was convicted on charges of conspiracy, obstruction of justice and making false statements and her former Merrill Lynch stockbroker, Peter Bacanovic, was convicted on four of five counts against him.
Stewart served five months in prison and near six months of house arrest starting in October 2004.
The charges stemmed from Stewart's sale of almost 4,000 shares of ImClone Systems stock in late 2001, just before the shares tumbled following a negative FDA ruling about the cancer drug Erbitux, which was later approved for use against colon cancer.
It's always the Cover-up they get you on, right Martha? Our Celebrity-Justice system hates 'Lying' don't you know? One day you're a god, the next day you're the goat.
The Real Insiders -- They get their Perks the 'Old Fashion Way' -- They just Take them ...
Insider Trading Is Perfectly Legal – But Only For Members Of The U.S. Congress
theeconomiccollapseblog.com -- May 24, 2010
Did you know that insider trading is perfectly legal in the United States? Well, not for 99.9% of the population. It is actually only a very small percentage of the population that can legally indulge in insider trading -- the members of the United States Congress. In fact, a law that would ban insider trading by members of Congress has been stalled for years on Capitol Hill. So why wouldn't lawmakers in Washington D.C. want to apply the same rules to themselves that apply to the rest of us? [...]
Good Questions ... but it is Congress afterall. When have they ever done what the People want, even though they claim to being doing just that (what the People want), whenever there's a camera near by ...
What is Insider Trading anyways? and why should you care?
Understanding Insider Trading
Definition, History, and Punishment
by Joshua Kennon, About.com Guide
The Definition of Insider Trading
Insider trading occurs when someone makes an investment decision based on information that is not available to the general public. In some cases, the information allows them to profit, in others, avoid a loss. (In the Martha Stewart - ImClone scandal, the latter happened to be the case.)
Insider trading was not considered illegal at the beginning of the twentieth century; in fact, a Supreme Court ruling once called it a “perk” of being an executive.
What Constitutes Criminal Insider Trading
Just what constitutes insider trading? The question is much trickier than it seems. In order for the SEC to prosecute someone for insider trading, they must prove that the defendant had a “fiduciary duty” to the company and / or intended to personally gain from buying or selling shares based upon the insider information. This test of duty, however, was significantly weakened by the Supreme Court's United States vs. O'Hagan ruling.
Section 16 Requirements: Safeguards Against Insider Trading
In order to prevent illegal insider trading, Section 16 of the Securities and Exchange Act of 1934 requires that when an "insider" (defined as all officers, directors and 10% owners) buys the corporation's stock and sells it within six months, all of the profits must go to the company. By making it impossible for insiders to gain from small moves, much of the temptation of insider trading is removed. Company insiders are also required to disclose changes in the ownership of their positions including all purchases and dispositions of shares.
And why should you care about Insider Trading? Especially if you were never much of a Martha Stewart fan in the first place?
Proposed Bill Aims to Ban Insider Trading by Congress
But a reintroduced bill called the STOCK Act (Stop Trading on Congressional Knowledge) is trying to change that. The bill was first introduced in 2006 by Rep. Louis Slaughter (D., N.Y.). Under the proposed rule, government workers would be banned from stock, commodity or bond trading based upon their access to privileged information.
Here's an example of the type of financial conduct that is currently legal that would be banned under the proposed 'STOCK Act':
Congressman A learns that the Chairman of the Appropriations Committee has decided to provide a multi-million dollar defense contract for Company B in the Defense Appropriations bill. This information has not been released to the public, but will almost certainly drive Company B's stock price up when it becomes public knowledge. Congressman A buys stock in Company B and makes a huge profit.
Oooh ... that is pretty serious then. Calling them just 'Insider Perks', doesn't really deal with the ethical issues involved, now does it?
Of course, who need ethics many will ask, in this rampant Age of "What's in it for Me?"
Who needs to follow the Law, when Law-makers and Market Regulators routinely 'Look the Other Way', when your Corporate Logo has the right sheen on its gold-plating ... when your CEO has the right speed-dials, programmed in at the Fed ... and with the Congress too?
[...]National Archives: SEC wrongfully destroyed records
In a letter Flynn sent to Senator Charles Grassley, he claimed the SEC destroyed files on important, high-profile cases, including Bernard Madoff, Goldman Sachs Group Inc (GS.N), trading in American International Group Inc (AIG.N) credit-default swaps, alleged frauds at Wells Fargo & Co (WFC.N) and Bank of America Corp (BAC.N) and insider-trading probes at Deutsche Bank AG (DBKGn.DE), Lehman Brothers and hedge fund SAC Capital.
"The SEC did not have the authority to dispose of them per the Federal Records Act," the National Archives said in a statement to the press.
by Sarah N. Lynch, Reuters -- Aug 18, 2011
What's a little SEC 'Faux Pas", among very Elite Company? What's the Harm?
It's not like the Goldman's of the World, will ever be subject to the same Laws, as the Martha's ...
Rolling Stone writes, "By whitewashing the files of some of the nation's worst financial criminals, the SEC has kept an entire generation of federal investigators in the dark about past inquiries into insider trading, fraud and market manipulation against companies like Goldman Sachs, Deutsche Bank and AIG. ..."Report: SEC has destroyed Wall Street probe records for 20 years
by Michael Winter, USA TODAY -- Aug 18, 2011
It not like the Goldman's of the World, really broke any serious laws now ... they may bend them -- but you'll never "catch them" breaking them. Not now. Just ask the SEC.
Hedge fund manager Raj Rajaratnam convicted of insider trading
by Ron Scherer, Staff writer, Christian Science Monitor -- May 11, 2011
In a case with widespread ramifications for the stock market, a federal jury has found Raj Rajaratnam, a billionaire and hedge fund manager, guilty of all 14 counts of securities fraud and conspiracy in his insider trading case.
Mr. Rajaratnam had maintained that the trades he made for the Galleon Group, which once managed as much as $7 billion, resulted from a “mosaic” of publicly available information. However, the jury, which convicted him of 9 counts of insider trading and 5 counts of conspiracy, listened to FBI wiretaps of Rajaratnam receiving information from corporate insiders, including a director of Goldman Sachs.
The Sri Lankan native is expected to appeal the legality of the wiretaps. He is free on $100 million in bail and must wear an electronic monitoring device around his ankle. [...]
Like I said, Membership in the Millionaire Club has its Privileges ...
Sorry Martha Stewart, you lose ... your 100K stealth just doesn't hold a candle to the Million Dollar trades that they cash-in on the Street every other day of the week. You were just a small fry, swept into their damn big Ocean. Just ask the SEC. They
are were drowning in paperwork.
Of course having Millions of Mad Money, to pay-out for Bail and Fines and Lawyers, never hurts either. When all else fails there's always an International Red-eye Flight you can book to Sri Lanka ... sooner or later, someone is likely to talk, no matter how much the SEC does to "take care of" any circumstantial evidence.
Fugitive Moody’s Analyst Ordered to Pay $35 Million to S.E.C.
by Peter Lattman, dealbook.nytimes.com -- August 24, 2011
Of the 26 defendants criminally charged in the government’s insider trading investigation centered on Raj Rajaratnam, the hedge fund billionaire, only one has not been convicted or pleaded guilty: Deep Shah.
Mr. Shah, a former bond analyst at Moody’s Investors Service, has been declared a fugitive and is believed to be in Mumbai.
On Tuesday, a federal judge ordered Mr. Shah to pay the government $34.6 million related to the Securities and Exchange Commission’s insider trading lawsuit against him.
Federal authorities have accused Mr. Shah of leaking the news of two impending private equity takeovers to hedge fund traders [...]
You never know, maybe the Big Fish Insider Trader WILL actually go to Jail this time, even without the SEC's "help" ... the FBI is on the case.
Lawyer Tied to Galleon Insider Trading Case Gets 36-Month Prison Sentence
by Patricia Hurtado, bloomberg - Aug 19, 2011
“We’re talking millions,” Goldfarb said. “Every one of us should be set for life within a year or two if things are played right.”
Sullivan noted the scheme went on for more than a year and that Goldfarb on another wiretap spoke of the potential gains they’d see from Goffer getting a job at Galleon because of the fund’s volume of trading.
Goffer was convicted of all 14 counts against him in June, in the second trial of defendants charged in a nationwide investigation of insider trading at hedge funds. Goffer’s former boss, Galleon Group co-founder Raj Rajaratnam, was convicted of insider trading in May. Prosecutors are seeking a sentence of more than 24 years when Rajaratnam is sentenced Sept. 27.
"Seeking 24 year sentence" for the Big Hedge Fund Fish, hooked on Goldman Sach's Hot Tip line ...
Who says Justice never sleeps? It's just making sure the evidence didn't get tossed in the Shredder, or something. Whoopsie! Cuz you just never know, so much paperwork -- so little time for actual Justice-keeping ... down there on Wall Street. Right next door to those very-tidy SEC Regulators.
The obscenely wealthy can Appeal any conviction into obscurity ... No wonder only the Little People, ever do time. That's the only option, THEY can afford.
I guess, that's just the way the Justice System ... crumbles ... in the Land where Money has been ruled just another form of Speech. And you know "Money Talks" ... all over the Land, the rest of us walk.
If you got the Access, you can Just Name your Price -- just ask your Congress Insider, what that little Privilege is worth. That Million dollar word: Priceless! comes to mind ...