Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Twilio employees, associates charged with insider trading by SEC

sec.gov

Post reply on HN
Print view View original

101–110 of 302 posts

Re: Twilio employees, associates charged with insider trading by SEC

#101

Post by hodgesrm »

bidirectional wrote: post #91
daenz wrote: post #57

Earlier quoted context omitted.

>I bet insider trading is not as fun when you're unemployed and bankrupt. Not just unemployed, likely unemployable by any reputable company in the industry. Also, good on you for having integrity, but honestly what you say is too much for the average person to be tempted with. Does anyone have a solution for lowering that temptation and making these scenarios less likely?

Legalising insider trading is the simplest solution.

It depends on your definition of the problem. The problem I would like to solve is ensuring that everyone perceives the market as fair, i.e., not tilted toward parties with access to privileged information.

Re: Twilio employees, associates charged with insider trading by SEC

#102

Post by ceeplusplus »

donatj wrote: post #100

> SEC’s complaint alleges that despite receiving a company policy that prohibited them from insider trading […] trade[d] Twilio options and stock in advance of its May 6, 2020 earnings announcement while in possession of the confidential information Isn't it illegal regardless of company policy? That's such weird phrasing.

Presumably this is so they can't claim ignorance and receive a lighter sentence.

Re: Twilio employees, associates charged with insider trading by SEC

#103

Post by tptacek »

ramesh31 wrote: post #90
extr wrote: post #8

What a lame way to insider trade. I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. Similarly you could imagine a lot more subtle ways to leverage insider Twilio information (count of verification texts sent by client?) to make far more obscure bets. The SEC definitely takes a look at anyo…

>I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. How is this seriously different than what any one of a million other "AI analytics" companies are doing with customer data right now?

Because it was Capital One's internal data, which belongs to the shareholders. US insider trading laws are about theft, not about fairness (the markets require "unfairness" in this sense in order to perform price discovery).

Re: Twilio employees, associates charged with insider trading by SEC

#104

Post by gcheong »

daenz wrote: post #57
kieselguhr_kid wrote: post #48

I work in billing software for a publicly traded software company and this is a constant temptation. I'm never gonna do it because I'm not gonna blow up my career for a relative pittance, but I can't tell you how many times I've been annoyed that I couldn't act on private information and make ~$100k or so. These guys are like the kids who saw the Tide Pod challenges and decided to actually eat the pods. I bet insider…

>I bet insider trading is not as fun when you're unemployed and bankrupt. Not just unemployed, likely unemployable by any reputable company in the industry. Also, good on you for having integrity, but honestly what you say is too much for the average person to be tempted with. Does anyone have a solution for lowering that temptation and making these scenarios less likely?

That's the point at which you launch your bid for congress.

Re: Twilio employees, associates charged with insider trading by SEC

#105

Post by bilbo0s »

ramesh31 wrote: post #90
extr wrote: post #8

What a lame way to insider trade. I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. Similarly you could imagine a lot more subtle ways to leverage insider Twilio information (count of verification texts sent by client?) to make far more obscure bets. The SEC definitely takes a look at anyo…

>I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. How is this seriously different than what any one of a million other "AI analytics" companies are doing with customer data right now?

The "AI analytics" companies are all communicating expressly their intent when they purchase the data at the outset. This makes it legal.

Full disclosure, I'm a privacy advocate and believe this sort of selling of customer data should not even be allowed. That said, what the companies you allude to do is totally legal by law, and significantly different in practice than taking data without informing anyone of your intent.

I guess the short answer to your question is that this is the United States. Everything is legal here, provided you do the paperwork first.

Re: Twilio employees, associates charged with insider trading by SEC

#106

Post by kieselguhr_kid »

daenz wrote: post #57
kieselguhr_kid wrote: post #48

I work in billing software for a publicly traded software company and this is a constant temptation. I'm never gonna do it because I'm not gonna blow up my career for a relative pittance, but I can't tell you how many times I've been annoyed that I couldn't act on private information and make ~$100k or so. These guys are like the kids who saw the Tide Pod challenges and decided to actually eat the pods. I bet insider…

>I bet insider trading is not as fun when you're unemployed and bankrupt. Not just unemployed, likely unemployable by any reputable company in the industry. Also, good on you for having integrity, but honestly what you say is too much for the average person to be tempted with. Does anyone have a solution for lowering that temptation and making these scenarios less likely?

I think it's a lot to be tempted with, but it's also relatively easy to stay in compliance: don't trade your company's stock during black out periods, don't talk about revenue with friends or family, and be vigilant about not publicly discussing your information. It's not a complicated code of ethics, fortunately.

Re: Twilio employees, associates charged with insider trading by SEC

#107

Post by decebalus1 »

rossdavidh wrote: post #29
charcircuit wrote: post #4

All insider trading should be legal. Imagine the opposite case. You know your company is doing poorly but the government forces you to not sell your stock and take a loss.

In those countries where insider trading is either explicitly allowed or laws against it are never enforced, nobody without inside information wants to play, because they know the game is rigged.

As opposed to the game being always rigged but without everyone knowing... just the insiders.

Re: Twilio employees, associates charged with insider trading by SEC

#108

Post by rosndo »

hodgesrm wrote: post #101
bidirectional wrote: post #91

Earlier quoted context omitted.

Legalising insider trading is the simplest solution.

It depends on your definition of the problem. The problem I would like to solve is ensuring that everyone perceives the market as fair, i.e., not tilted toward parties with access to privileged information.

This implies a truly bizarre understanding of markets and fairness.

Was it fair when Enron was valued at $70B? Would the situation have been less fair had insider traders with more information pushed the prices down earlier?

Insider trading doesn’t cost anybody anything, it simply allows for more accurate pricing which benefits everybody.

Re: Twilio employees, associates charged with insider trading by SEC

#109

Post by maxerickson »

ramesh31 wrote: post #90
extr wrote: post #8

What a lame way to insider trade. I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. Similarly you could imagine a lot more subtle ways to leverage insider Twilio information (count of verification texts sent by client?) to make far more obscure bets. The SEC definitely takes a look at anyo…

>I thought that instance of the Capital One analysts using internal database queries to understand which retailers were having good quarters was far more interesting and insidious. How is this seriously different than what any one of a million other "AI analytics" companies are doing with customer data right now?

It's discussed in the link they added. The retailers shared the data with Capital One for specific business purposes, not for stock market analysis.

Re: Twilio employees, associates charged with insider trading by SEC

#110

Post by corentin88 »

runako wrote: post #9

I'm sure the SEC has an array of tools with which to comb through the data, but I would bet that the vast majority of these cases against non-professional traders are flagged by identifying retail brokerage accounts where the notional value of options outstanding is 1) larger than some % of the the portfolio size (e.g. > 50%) 2) with exposure concentrated on 1-3 stocks 3) with no similarly-sized follow-up trades in o…

It’s more likely to me that they talked about it internally (to colleagues?) and someone reported it to HR, the police or SEC directly.
Post reply on HN