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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

#31

Post by tempsy »

RC_ITR wrote: post #23
tempsy wrote: post #11

Earlier quoted context omitted.

uhm it’s not even that difficult. they just see if you traded in your own account for a company you work for around earnings. i’m pretty sure you’re not supposed to do it at all but maybe dependent on the situation.

>The Securities and Exchange Commission today announced insider trading charges against three software engineers employed at Twilio, Inc., a San Francisco-based cloud computing communications company, and four family members and friends for allegedly generating more than $1 million in collective profits by insider trading ahead of the company’s positive first quarter 2020 earnings announcement on May 6, 2020. This, a…

i mean it’s not clear it could have been all of them. not really the point i’m making..yes it could have been done exclusively using family that the government clearly knows you’re linked to. maybe more difficult with friends.

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

#32

Post by throwoutway »

tempsy wrote: post #19
toomuchtodo wrote: post #13

Earlier quoted context omitted.

> I'm sure the SEC has an array of tools with which to comb through the data They have a fairly robust analytics/data science team, and will also act on referrals from FINRA related to suspicious/anomalous trade activity.

isn’t this what they use Palantir for?

I don’t think so, I saw a FINRA talk 5+ years ago where they described their home built data analytics that could process all daily trades looking for something similar to what the GP described

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

#33

Post by notch656a »

syshum wrote: post #24
derekp7 wrote: post #10

Earlier quoted context omitted.

Something I was always curious about, but I lack the legal background to find the answer. What if public information showed that you should sell the stock, but you decide to hold it instead (i.e., not do anything at all) because you have insider information that the company will be doing much better than expected? The "not selling" part (assuming you bought stock prior to having insider knowledge) is a form of inside…

not a lawyer, but inaction should never be criminalized.

Unfortunately it commonly is. One example is mandatory reporters. For some licensed professions, it is a thought crime to merely have the thought that you suspect a child meets some criteria of neglect/abuse, while not performing any action to relay the thought to authorities. This can lead to unwarranted and damaging/traumatic CPS investigations merely so a professional can cover their ass.

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

#34

Post by mgraczyk »

xyst wrote: post #27

This is a proud win in the SEC handbook? $1 million dollars is fucking chump change. Whales do this on a 1000X scale every fucking day (yes billions). They even collaborate amongst other trading firms to pump and dump. Where's the prosecution related to the GME + Citadel Securities + Melvin Capital illegal naked short selling? Remember when this group was hemorrhaging billions of dollars and forced RH to remove the "…

They are though

https://www.thestreet.com/markets/regulation/doj-sec-probe-d...

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

#35

Post by RC_ITR »

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…

>count of verification texts sent by client

This is what I thought it would be based on the headline and was frankly disappointed that the truth was so quotidian. Certain Twilio engineers could very likely keep an index of major gig-economy/delivery services and track both user and driver sign-ups in a way that could be very valuable NMPI and have the advantage of being at a broad range of companies that are only tangentially related to their employer.

In fact, @SEC if you're reading this, you might be missing some bigger fish...

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

#36

Post by ethbr0 »

rossdavidh wrote: post #25
tempsy wrote: post #2

I can’t understand the rationale behind blowing up your life and career in which you made $300k+/year for a tiny $1m gain split between 3 people and their families. Why are people who should otherwise be much smarter than this doing incredibly dumb things? Just greed? and entitlement?

My wife owns a small retail clothing store. It is her experience that the people who attempt to steal, are not generally lower income, they are often among the most well-to-do members of the population that goes through her store. Very different stakes, and very different age group (she mostly sells to teenagers and twentysomethings), but same psychology, I think. "I'm not the sort of person who gets arrested and sen…

I call this the "National Park effect".

Being constantly coddled in some way dulls your ability to recognize when circumstances have changed, and those safeguards are no longer present.

See: tourists who wander off in National Parks with no cell service, with no water or survival gear, and then think it's a good idea to pet a bison

The concept of laying bleeding, miles from the nearest road, with broken bones, as night falls and the temperature drops is so foreign to their experience that it just isn't an imagined possibility.

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

#37

Post by syshum »

sneak wrote: post #20
broknbottle wrote: post #16

When is the announcement happening for the members of congress that made investments in key areas after they were briefed on covid-19 and potential impact? > We are a free market economy. They should be able to participate in that

Insider trading requires privileged access to inside information. Covid impacts to society are not inside/internal data to those companies, those briefings were happening when it was obvious we were having a global pandemic to anyone paying attention. The inputs to the deductive reasoning process were public information.

Congress is privy to inside information that impacts the market via several mechanism including private briefings for upcoming policy changes, or knowing about laws that will be passed before the actual votes

Congress should be investigate more thoroughly for insider trading, or even barred from trading at all (which is my preferred solution)

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

#38

Post by fatnoah »

derekp7 wrote: post #10
syshum wrote: post #6

Earlier quoted context omitted.

if you are in the position of knowing secret data of a publicly traded company, and you are uncomfortable with the position of possibly losing money because you can not act on the secret data, I would suggest you not hold stock for companies you know secret data about No insider trading should not be legal

Something I was always curious about, but I lack the legal background to find the answer. What if public information showed that you should sell the stock, but you decide to hold it instead (i.e., not do anything at all) because you have insider information that the company will be doing much better than expected? The "not selling" part (assuming you bought stock prior to having insider knowledge) is a form of inside…

AFAIK, that wouldn't be considered insider trading since there was no trade.

However, there's an even more interesting wrinkle. In that case, you plan trades well in advance, and then cancel them based on insider information. In one case, that was rules to not be insider trading either.

https://en.wikipedia.org/wiki/SEC_Rule_10b5-1

"After Rule 10b5-1 was enacted, the SEC staff publicly took the position that canceling a planned trade made under the safe harbor does not constitute insider trading, even if the person was aware of the inside information when canceling the trade. The SEC stated that, despite the fact that 10b5-1(c) requires trades to be irrevocable, there can be no liability for insider trading under Rule 10b-5 without an actual securities transaction, based on the U.S. Supreme Court's holding in Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723 (1975).[6]"

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

#39

Post by xyst »

mgraczyk wrote: post #34
xyst wrote: post #27

This is a proud win in the SEC handbook? $1 million dollars is fucking chump change. Whales do this on a 1000X scale every fucking day (yes billions). They even collaborate amongst other trading firms to pump and dump. Where's the prosecution related to the GME + Citadel Securities + Melvin Capital illegal naked short selling? Remember when this group was hemorrhaging billions of dollars and forced RH to remove the "…

They are though https://www.thestreet.com/markets/regulation/doj-sec-probe-d...

investigations != prosecutions

when sec posts the story, then I will believe it. I strongly suspect the "investigations" will lead to nowhere.

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

#40

Post by [deleted] »

jasonlotito wrote: post #17
tempsy wrote: post #2

I can’t understand the rationale behind blowing up your life and career in which you made $300k+/year for a tiny $1m gain split between 3 people and their families. Why are people who should otherwise be much smarter than this doing incredibly dumb things? Just greed? and entitlement?

> Why are people who should otherwise be much smarter than this Being smart at your job doesn't mean you aren't ignorant. In fact, I'd say the culture of equating "good at computers" meaning you are probably "smarter than this" does more to shield us from the truth of our own ignorance.

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