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Twilio employees, associates charged with insider trading by SEC

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

#241

Post by alephnan »

dijonman2 wrote: post #217
gumby wrote: post #126

Earlier quoted context omitted.

> but honestly what you say is too much for the average person to be tempted with. I think you underestimate the “average person”. Most people basically want to be good. Everything works better when that is the case — basic game theory. You see the punishment / pressure about unfairness start in early childhood. You see it in the infrastructure where this is overwhelmingly the case (e.g. shops with unguarded back ent…

people want to be good but debt and financial problems can negatively impact judgement. people take risks when they are desperate. I’m sure it happens all the time, we just heard about the ones who got caught. Personally I would never do it as I can make much more by keeping my job and the field I’m in is all about ethics and integrity. I would rather hustle with contracting or job shop to get a raise if I really nee…

> people want to be good but debt and financial problems can negatively impact judgement. people take risks when they are desperate.

Tech ( corporate ) pays well enough that anyone with reasonable cost of living and lifestyle shouldn’t resort to extreme desperate measures. The rest is greed. The fact these people have money to play with stocks already shows they’re much better off than the average person.

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

#242

Post by alephnan »

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.

They wouldn’t have done if it they expected to be caught.

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

#243

Post by Bedon292 »

harry8 wrote: post #228
joering2 wrote: post #189

Earlier quoted context omitted.

Case of Pelosi comes so often but she is a very weak example. Came from $300,000,000 family fortune "her" stock picks (she obviously doesn't pick herself but has financial firm representing and making moves on her behalf) did merely $6,000,000 in last 10 years, according to her tax statements. I don't get why her "inside trading" and her fridge full of ice-cream triggers so many people; people who clearly haven't don…

Because her husband is the person making their trades? That seems pretty far from "weak" to me. https://www.businessinsider.com/nancy-pelosi-discloses-stock...

They have to disclose when family members make the trades, as shown by the article you posted. So its not really clever when it still gets disclosed. And something like having a spouse do the trades certainly isn't either. That's easy for the SEC to check too.

But what evidence is there that any of that is trading on non public information? I just lists off some of the most popular companies out there to invest in. The trades include AmEx, Apple, PayPal, Disney, Slack, Tesla, Alphabet, Facebook, and Netflix. I would be surprised if they didn't trade in many of those companies.

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

#244

Post by Bedon292 »

55555 wrote: post #240
kasey_junk wrote: post #219

Earlier quoted context omitted.

Not many? Describe the trade steps necessary to insider trade with high leverage that isn’t trivial for a data analytics program to flag with high confidence?

1. Find out using inside information that Twilio is having a good quarter due to macro conditions 2. Buy deep OTM call options in… a similar company that’s in the same business as Twilio 3. Never get in any trouble

But that's not insider trading. You don't have inside information on that other company. You have a guess that their business is doing similar. When perhaps Twilio is doing so well because they took business from that competitor or something else that makes them stand out.

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

#246

Post by refurb »

otterley wrote: post #223
deObfuscate wrote: post #136

Earlier quoted context omitted.

So, if I were a trader at Enron who made good money trading electricity and gas then used that money to short the stock based on private information, I'd be doing everyone a service and fighting for fairness. Better yet, I could be one of their auditors at Arthur Andersen.

Oh, please. You wouldn't be doing everyone a "service" because you'd be making money (or at least losing less) than the other investors - you'd have a material advantage. If you truly wanted to do the world a service, you would have just publicized their fraud and taken a bath along with everyone else.

But the economic award is just the cost of a more correct market price and it happens all the time.

For example a mask manufacturer. They might have a relative in China who shares information about the outbreak of a new virus. Manufacturer uses this completely legal information to produce a ton of masks and makes record profits off the sales because they're right. But the public benefits as well because there are actually masks to purchase.

And another example are whistleblower payments. We have no problem giving whistleblowers millions of dollars for uncovering fraud because the cost is far lower than the benefit.

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

#247

Post by taxyz23 »

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 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 trading is not as fun when you're unemployed and bankrupt.

And in jail.

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

#248

Post by refurb »

ffggvv wrote: post #113
rosndo wrote: post #54

Earlier quoted context omitted.

> These guys are like the kids who saw the Tide Pod challenges and decided to actually eat the pods. I bet insider trading is not as fun when you're unemployed and bankrupt. Most insider traders are never caught, everyone eating tide pods gets sick.

my guess is if they did everything via in person discussions and didnt leave a paper trail of messages, they likely wouldnt have been caught

Matt Levine wrote some good articles on how people get busted.

The main point is you can't buy or sell securities without identifying yourself. So when someone opens a new account and buy out-of-the-money call options that expire a few days after an earnings announcement it's not hard for the SEC to flag all those.

Then all they have to do is look up that person and see if they have any connection to the company. They can look at who you are connected to on LinkedIn, who you live with, where your family is employed. Then they come to that person and ask them a question that seems innocuous "Have you ever discussed Company X with ". If you lie, then you've already committed a felony when they get your text records or email or Whatsapp.

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

#250

Post by Bedon292 »

kasey_junk wrote: post #208
elwell wrote: post #204

If the employees were receiving (vesting) a standard monthly amount of RSUs for compensation, normally selling immediately upon vesting, and decided to wait a couple months based on inside information about company performance that they were just naturally exposed to during their work, would that be considered insider trading? I assume it would. Hmm... it's kind of scary how easy it would be to inside trade without r…

Most public company equity sales are subject to blackout periods where you cannot sell (usually prior to release of financials) because it is presumed anyone with equity compensation views material non-public information as a matter of course. Selling in those dates is subject to liabilities for the employees. That said if your equity management system doesn’t handle this for you, you have other problems.

My company has blackout periods for certain parts of the company, such as finance. But not the whole company. And it does light grants for most all employees. But it gets pretty fuzzy fast as to who has MNPI vs who doesn't. Did someone mention a contract not getting renewed? Well now you might have MNPI and not be allowed to trade. Best to keep out of the blackout windows, and be extremely careful.
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