Note to Executives: Don’t Use Work Computer to Research Insider Trading
On August 2nd, the SEC charged an executive at Bristol-Myers Squibb with insider trading on confidential information about companies being targeted for potential acquisitions.
The SEC alleges that Robert D. Ramnarine made more than $300,000 in illegal profits by misusing nonpublic information he obtained while helping Bristol-Myers Squibb evaluate whether to acquire three other pharmaceutical companies. He used multiple personal brokerage accounts to illegally trade in stock options of these potential target companies. Prior to some trading, Ramnarine conducted Internet research from his Bristol computer to determine whether he could be detected by regulators. He searched for such phrases as “can stock option be traced to purchaser” and “illegal insider trading options trace” and viewed such articles as “Ways to Avoid Insider Trading.” Ramnarine even viewed a press release on the SEC’s website announcing an enforcement action arising from illegal trading in call options in advance of an acquisition announcement.
See also Dealbook, which likened Ramnarine’s actions to “Stupid Insider Trading Tricks.”
Read today’s entire Knowledge Mosaic Weekly Regulatory Report here.