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DOJ: Hackers broke into an SEC database and made millions from inside info

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Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#111

Post by wtvanhest »

blancheneige wrote: post #101
gtirloni wrote: post #47

Earlier quoted context omitted.

You mean they rely solely on someone dictating a SSN number? That's insane. They should ask for a official ID with photo, as the very minimum. Is that something that goes against the American culture? The other day I had to give all 10 fingerprints to renew my driver's license (location: South America) and nobody seemed to care.

there are places here that will let you vote for the president of the united states without requiring proof that you are a US citizen. what do you expect.

That really isn't a big deal since you need to prove residence to register. There are a limited number of votes that can be made. If two people show up saying they are the same person, that will create a red flag.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#112

Post by lozaning »

btbuildem wrote: post #76

People make money off advance information all the time. Often you can see that in the price action -- take this for example: https://imgur.com/mJq1OcY Three days before a positive press release, demand pressure beings to drive up the price. Coincidence? I'm too jaded to believe that.

Is this not just a case of trade the rumor sell the news?

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#113

Post by wildmusings »

rrdharan wrote: post #105
wildmusings wrote: post #103

Earlier quoted context omitted.

> Wrong. It's insider trading if you have material, nonpublic information. It doesn't matter how you got that information. You are totally mistaken as far as the law in the United States. I can’t speak for other jurisdictions.

As I posted above, the poster is not mistaken.

I think you've misread the thread.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#114

Post by TomVDB »

anonymfus wrote: post #108
briffle wrote: post #59

Earlier quoted context omitted.

that is what wtvanhest is talking about. If everyone has your social, its no longer considered a secret (like a password) its more like a unique identifier (an email address) just like it was intended to be.

> its more like a unique identifier AFAIK they are not ever unique

Article written in 2014:

> To date, 450+ million SSNs have been issued, but with just under 1 billion possible number combinations, there has never been a need to recycle numbers, and the SSA notes that it does "not reassign a Social Security number (SSN) after the number holder's death."

https://gizmodo.com/what-happens-to-your-social-security-num...

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#115

Post by lloydde »

hkmurakami wrote: post #95

Related reading: today's Matt Levine piece on how hard it is to make money even with this info. https://www.bloomberg.com/opinion/articles/2019-01-16/even-c...

This situation brings to mind last year’s Verge article “HOW AN INTERNATIONAL HACKER NETWORK TURNED STOLEN PRESS RELEASES INTO $100 MILLION” https://www.theverge.com/2018/8/22/17716622/sec-business-wir...

The article include a great line “The [Ukrainian] intelligence agents began running a parallel operation to the Moscovite middlemen, using Turchynov’s access and sourcing their own traders, according to Demedyuk.”

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#116

Post by Jedi72 »

bobthepanda wrote: post #61
gtirloni wrote: post #47

Earlier quoted context omitted.

You mean they rely solely on someone dictating a SSN number? That's insane. They should ask for a official ID with photo, as the very minimum. Is that something that goes against the American culture? The other day I had to give all 10 fingerprints to renew my driver's license (location: South America) and nobody seemed to care.

America historically was not very federalized, and being able to just abandon your life and move out west is a key part of the country's mythology, if not the DNA of the country. So there have always been attempts to resist a national ID system, and the SSN was originally not supposed to be used for this purpose. Of course in 2019 this is basically a moot point if you want to be integrated into society, but even then…

I have thought about this a little bit. If this is something Americans believe in, its time to make it official. Make a legal proceeding where you can "start again", so that nobody from your old life can trace you.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#117

Post by ben509 »

anonymfus wrote: post #108
briffle wrote: post #59

Earlier quoted context omitted.

that is what wtvanhest is talking about. If everyone has your social, its no longer considered a secret (like a password) its more like a unique identifier (an email address) just like it was intended to be.

> its more like a unique identifier AFAIK they are not ever unique

They're not reliably unique: a nontrivial percentage of the population has multiple numbers associated with them, and a nontrivial percentage of the numbers are associated with multiple people.

If you have two systems and you want to correlate data between them, you can use something like the SSN to assist in that process, but usually it will need additional information.

Generally you can't use something someone supplies as a shared identifier. You can't start the process of verifying it, after all, without an identifier. You might think of all sorts of ways around this, but they all boil down to either tolerating errors or making the SSN a secondary attribute rather than a bona fide identifier.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#118

Post by ben509 »

JumpCrisscross wrote: post #19
rocqua wrote: post #13

Earlier quoted context omitted.

Insider trading is a balance. On the one hand, we want market prices to be accurate. This means we want people with material information to trade on that information. On the other hand, we need some fairness in a market. This is mostly to ensure people keep trading. In a world were inside-info is commonplace, trading without it is just stupid. This would cut off a lot of people from investing. The line needs to be dr…

> On the other hand, we need some fairness in a market American insider trading law has nothing to do with fairness. It is based on theft of information. In this case, the hacker’s stole information from the SEC that belonged to the reporting companies. (This is a commonly misunderstood alley of securities law.)

That's interesting. I was digging around, and this piece[1] goes into detail, but early on they summarized the rationale for insider trading laws.

"One objection is that it violates the fiduciary duties that corporate employees, as agents, owe to their principals, the shareholders (Wilgus 1910)."

That supports the theft formulation.

"A related objection is that, because managers control the production of, disclosure of, and access to inside information, they can transfer wealth from outsiders to themselves in an arbitrary and hidden way (Brudney 1979; Clark 1986)."

Again, supports the theft formulation.

"The economic rationale advanced for prohibiting insider trading is that such trading can adversely affect securities markets (Khanna 1997) or decrease the firm’s value (Haft 1982)."

This seems like the fairness argument, though.

[1]: https://www.econlib.org/library/Enc/InsiderTrading.html

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#119

Post by ben509 »

JumpCrisscross wrote: post #29
beaconstudios wrote: post #23

Earlier quoted context omitted.

if that were the case, it would be legal for a company director to trade on information they gleaned from an internal meeting. Which, as far as I understand, it isn't.

> if that were the case, it would be legal for a company director to trade on information they gleaned from an internal meeting That’s theft of company (read: shareholders’) information by a fiduciary. Remember: America has no statute barring insider trading. The rules were developed through case law. (There’s a hypothetical of “if a company insider shouts material nonpublic information on the street and you trade on…

The 1933 Securities Act, 1934 Securities Exchange Act and the Sarbanes-Oxley Act of 2002 all directly address insider trading.

Re: DOJ: Hackers broke into an SEC database and made millions from inside info

#120

Post by LeifCarrotson »

gtirloni wrote: post #47
aboutruby wrote: post #41

Earlier quoted context omitted.

And yet many services rely on SSN for identity verification in the US (e.g. banks, telecoms, etc.)

You mean they rely solely on someone dictating a SSN number? That's insane. They should ask for a official ID with photo, as the very minimum. Is that something that goes against the American culture? The other day I had to give all 10 fingerprints to renew my driver's license (location: South America) and nobody seemed to care.

> Is that something that goes against the American culture?

Conservative Christian fundamentalist groups have, ever since Reagan, likened a national ID card to "the mark of the beast", citing Revelation 13's prophecy that no one could buy or sell goods without the number of the beast, and the reference to God's chosen people that refuse the mark of the Beast.

When a small but meaningful fraction of your constituents fervently believe that giving them a national ID literally damns them to Hell, it's a hard sell.

Much easier if you attach it to a tool (Social Security) with which they can get money.

There's also the angle of State's Rights and whether the federal government can require people to have national ID over just amalgamating the various state IDs.

Finally, Americans generally distrust their government. Not without reason, they believe a national ID would reduce their privacy and allow the government to more easily spy on and track them.

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