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Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

bloomberg.com

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Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#71

Post by LeifCarrotson »

21 wrote: post #51

So one guy sold 1 mil of stock, the stock dropped 6%, so he avoided a 60k loss. Let's say he expected a 20% drop, and he saved 200k. If a were a millionaire, I wouldn't risk prison for 200k. Even the litigation to avoid prison could cost 100k. And this is the kind of thing you know all angles will be looked into (it took a news agency a few hours to unearth this). If he did it (insider trading), he is very stupid.

> If a were a millionaire, I wouldn't risk prison for 200k.

This is part of the reason why you aren't a millionaire. Wealth selects for people who do some strange things to make a little extra money here and there... and there... and there... and there....

It's also why people who aren't like these millionaires (whether of similar means but less wealth or of greater means but fewer questionable choices) think some millionaires make foolish, cruel, or inhumane decisions.

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#72

Post by thephyber »

mnm1 wrote: post #22

The only reasonable punishment for this is decades in jail. If they can't put these assholes in jail for running the credit check companies themselves, at least convict them for insider trading. These businesses should not exist to being with. I'm not sure what the penalty for insider trading is, but if the prosecutors a little creative, they could convict for each share sold. That should keep these scumbags in jail…

> If they can't put these assholes in jail for running the credit check companies themselves

Who is "they"? You realize Congress has effectively cemented the place of the big three credit bureaus in the daily life of all Americans, right?

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#73

Post by thephyber »

stuaxo wrote: post #20

That reminds me I need to update my address on Equifax. I found out it was wrong after being refused to be allowed to buy a mobile data plan (even though I had all the cash it counts as a credit issue). After 5-6 phone calls to get the address added to their system, I never did the final one a few days later to get them to update me once it was in their system. Absolute bunch of arses.

It's amazing how they make it difficult to give them more information. Granted, you aren't paying them directly, but you are effectively making their business more valuable by linking more accurate data to their profile of you.

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#75

Post by loeg »

khuey wrote: post #18
loeg wrote: post #12

Earlier quoted context omitted.

That doesn't answer the question. We all read that the trades were not planned in advance. The question is, is that by definition illegal? Or were the trades only illegal because they had insider knowledge that the price was about to drop?

If they had access to material non-public information and then decided to trade it would be illegal. Trades that are not planned in advance are not illegal in and of themselves.

Do you think executives ever do not have access to material non-public information?

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#76

Post by boomboomsubban »

ceejayoz wrote: post #57
21 wrote: post #51

So one guy sold 1 mil of stock, the stock dropped 6%, so he avoided a 60k loss. Let's say he expected a 20% drop, and he saved 200k. If a were a millionaire, I wouldn't risk prison for 200k. Even the litigation to avoid prison could cost 100k. And this is the kind of thing you know all angles will be looked into (it took a news agency a few hours to unearth this). If he did it (insider trading), he is very stupid.

Martha Stewart was a billionaire and wound up spending prison time over an insider trading savings of $45,673. Logic doesn't always apply.

This assumes she became a billionaire completely legally, and only then made one illegal move. The logic assumes you won't get caught, or the fine will be minimal. Much like speeding to the average person.

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#77

Post by fencepost »

jzwinck wrote: post #32
devmunchies wrote: post #25

Earlier quoted context omitted.

Off topic question... Is there a law about giving legal advice in a public forum if you're not a lawyer? Why do people add the disclaimer about not being a lawyer. Generally curious. Moreover, is there a law about impersonating lawyer in a public forum (not that any ethical person would do that of course)?

No there is not a law against giving legal advice if you're not a lawyer. It's lawyers who are sometimes prohibited from giving legal advice. Non-lawyers have the usual freedom of speech, restricted in the usual ways. Claiming that you are someone you're not on the Internet is so commonplace it is hard to see where any trouble would come of it by itself. Again it's different if you knowingly cause harm to others. I'm…

You sometimes see this as IAALBINYL (instead of the more common IANAL), standing for "I Am A Lawyer But I Am Not YOUR Lawyer"

Or, "free legal advice is worth what you paid for it."

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#79

Post by mathattack »

korethr wrote: post #7

So, does this count as insider trading? My intuition says 'yes'. But my intuition about a thing and what the law says don't always match.

From the article:

Regulatory filings show that three days later, Chief Financial Officer John Gamble sold shares worth $946,374 and Joseph Loughran, president of U.S. information solutions, exercised options to dispose of stock worth $584,099. Rodolfo Ploder, president of workforce solutions, sold $250,458 of stock on Aug. 2. None of the filings lists the transactions as being part of 10b5-1 scheduled trading plans.

The three “sold a small percentage of their Equifax shares,” Ines Gutzmer, a spokeswoman for the Atlanta-based company, said in an emailed statement. They “had no knowledge that an intrusion had occurred at the time.”

The timing is very suspicious, but if they can prove that they had no knowledge, then they are safe. Given their titles, that seems like a dubious claim.

Re: Three Equifax Managers Sold Stock Before Cyber Hack Was Revealed

#80

Post by peterwwillis »

ConnorBoyd wrote: post #17
korethr wrote: post #7

So, does this count as insider trading? My intuition says 'yes'. But my intuition about a thing and what the law says don't always match.

They traded based on material, non-public information, so I would have to say yes, this is definitely insider trading, but I'm not a lawyer...

Food for thought: you are basing your admittedly uneducated opinion of a legal matter on a single criteria.

If you end up being right, it will have been almost pure luck, but it may reinforce certain incorrect assumptions, like your theory that this single criteria was the deciding factor, or that this kind of armchair analysis is productive.

Point being: even if you are right, it's probably a bad idea to even take the position to begin with.

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