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Husband of Amazon employee sentenced to prison for insider trading Amazon stock

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Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#181

Post by zfxfr »

I am French. I have never been to America. From my point of view, so the view of an European who only know USA through the eyes of various medias. I am under the impression that justice sentences are very harsh there ! It looks like anybody can be sent to prison for pretty much nothing.

Wow ! 26 months ! In France he would have been sentenced to 4 or 5 SUSPENDED months.

My parents and some of their friends plans to go to USA for tourism I hope they don't get arrested (pulled over). My dad speaks English "like a Spanish cow" and his attempt at making jokes might not please the officers.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#182

Post by yellow_lead »

ALittleLight wrote: post #46
smnrchrds wrote: post #25

Earlier quoted context omitted.

If you ignore all the ethical aspects of it and look at it as a purely economic transaction, whether it was a great trade or not depends on the odds of getting caught, not just the punishment if you get caught.

That's true. I wonder what the odds of getting caught are. I wonder how the odds would change if you had someone unconnected to you who placed the trades and shared the profits. As I write this I can imagine a cryptocurrency marketplace for insider information. The insider asserts some fact about a company and stakes an amount in crypto. Buyers see the potential - e.g. "Amazon insider staking 1 million for X% return"…

Theres something much simpler - tokenized stocks. These are coins that track certain popular stocks and indices. There is certainly one for Amazon.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#183

Post by yarcob »

bhahn wrote: post #29
samfisher83 wrote: post #3

Earlier quoted context omitted.

How did his wife get no prison time?

Just speculation, but they may have children, and if so, prosecutors may have wanted to keep at least one parent out of jail.

It would be nice if prosecutors really were that compassionate. I've read that lots of kids end up in foster care because their parents go to jail. But maybe that only happens to poor people.

An alternative would be to have criminal parents serve time consecutively -- that way noone gets away, and the children would not have to be taken away.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#185

Post by benrbray »

seanmcdirmid wrote: post #131
JumpCrisscross wrote: post #101

Earlier quoted context omitted.

> How do such people think that they are going to get away with this? Many Americans think insider trading is l common than. If everyone is getting away with 70 mph, you can too. (Exhibit A: this thread.) In reality, insider trading enforcement is effective. The SEC looks for unusually profitable trades ex post facto . Their verification is easier than the insider trading. Wall Street doesn’t insider trade because it…

Were they even American? I've heard more than a few stories of immigrants coming the states, working tech jobs, and ... getting thrown in jail for insider trading because their stock market worked very very very differently back home. It has gotten so bad that many of the big techs include mandatory training on what inside trading is and how not to do it.

I think that mandatory training is useful for everyone, not just immigrants. It's not like American high schools / colleges are teaching about finance.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#186

Post by bryanrasmussen »

Taniwha wrote: post #150
peeters wrote: post #86

Earlier quoted context omitted.

If you work for a company that grants stock via shares or options, you're going to have to sell them at some point. At which point insider trading applies.

And your company will carefully tell you when the safe times to do so (usually a month or so after a quarterly result or some such announcement)

>And your company will carefully tell you when the safe times to do so

not familiar with the whole situation, but I'd worry the company would tell me times that were advantageous for it, not necessarily for me.

on edit: I suppose the downvotes are HNs way of telling me that would be a silly thing to worry about. Thanks for the clarification.

on second edit: thanks for the actual clarifications as to why I would be silly to worry about that kind of thing.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#187

Post by vmception »

wolfretcrap wrote: post #141
lizdax wrote: post #2

>he obtained from his wife, an Amazon finance employee, to place trades in Amazon stock–making a profit of $1,428,264 >Bohra engaged in illegal insider trading in advance of 11 straight earnings announcements.” >He and his family members have paid $2,652,899 in disgorgement, interest and penalties. And 26 months in prison! This is why if you're going to do any kind of trading yourself -- never touch the company you w…

If simply being husband of a woman who works for Amazon can help you acquire such information on which you can perform insider trading. What stops from former workers at intelligence agencies from starting a hedge fund and employing all methods they learned while at work, to acquire such valuable information, trade based on that and offer others money management services?

Usually just the lack of startup capital and lack of pedigree to get wealthy enough investors

There isn’t an inherent legal issue here

Insider trading also requires you or the person you got information from to have a fiduciary or contractual duty not to share information

That typically ends after employment or when the NDA expires

There is nothing illegal about having an advantage in the market, if thats the assumption where you are starting from

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#188

Post by vmception »

samfisher83 wrote: post #3
lizdax wrote: post #2

>he obtained from his wife, an Amazon finance employee, to place trades in Amazon stock–making a profit of $1,428,264 >Bohra engaged in illegal insider trading in advance of 11 straight earnings announcements.” >He and his family members have paid $2,652,899 in disgorgement, interest and penalties. And 26 months in prison! This is why if you're going to do any kind of trading yourself -- never touch the company you w…

How did his wife get no prison time?

They kicked back and relaxed, Emphasis on kickback.

Basically they were able to cough up the $2mm the SEC wanted in the parallel civil suit, and didnt attempt to challenge the criminal case, so the prosecutors in the criminal case chose not to

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#189

Post by chrisjharris »

ping_pong wrote: post #175
chrisjharris wrote: post #111

Earlier quoted context omitted.

I don't disagree with the general sentiment that the GFC was a total disaster, and I'd certainly not argue against the idea that a system had developed that had poor incentives, with sometimes greedy and unethical people working in it. What kind of concerns me, though, is the way that poor decision-making is conflated with breaking the law, or the belief that a terrible outcome ex-post necessarily implies illegality.…

The GFC is a direct result of illegal behavior. If you don't understand that, you don't understand the GFC. The major problem is that Wall Street investment banks were marking shitty debt as AAA when it was no such thing. Because it was marked as AAA, the bad debt was bought throughout the globe because pensions and funds globally wanted only AAA debt. They knew the debt was shitty even as they were marking them as A…

Well, those providing credit ratings (the rating agencies) were not the same as those selling the debt (investment banks). But more than that I think it's unwise to be so certain about intent - how do you know they were deliberately getting the ratings wrong, and not making a giant mistake? The rating agencies did very badly from the crisis, so it's hard to argue that they also saw the whole thing coming with premeditation.

I also think your explanation of the GFC overlooks what was an extremely multi-factorial situation. Most explanations would allocate some causality to changes in regulation, changes in global debt dynamics. Securitization aside, it was the peak of a huge borrowing/lending boom not unlike numerous previous financial market crashes.

Re: Husband of Amazon employee sentenced to prison for insider trading Amazon stock

#190

Post by bawolff »

bryanrasmussen wrote: post #186
Taniwha wrote: post #150

Earlier quoted context omitted.

And your company will carefully tell you when the safe times to do so (usually a month or so after a quarterly result or some such announcement)

>And your company will carefully tell you when the safe times to do so not familiar with the whole situation, but I'd worry the company would tell me times that were advantageous for it, not necessarily for me. on edit: I suppose the downvotes are HNs way of telling me that would be a silly thing to worry about. Thanks for the clarification. on second edit: thanks for the actual clarifications as to why I would be si…

I think its usually a very pre-arranged time (like once a quarter shortly after the quarterly earnings since you cant know what's in the next quarterly earning if the previous one just happened).

Besides, are there really bad and good times for the company? Its not like the company itself is affected, just the stock holders. Management wants stock to go up because management usually owns stock. So screwing you would also screw themselves.

Last of all, if you dont like the blackout periods, you can just setup an arms length plan to bypass it https://www.investopedia.com/terms/r/rule-10b5-1.asp

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