Twilio employees, associates charged with insider trading by SEC • Hacker News Board

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

#91

Post by bidirectional » Mon, Mar 28, 2022, 9:29 PM UTC

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?

Legalising insider trading is the simplest solution.

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

#92

Post by usrusr » Mon, Mar 28, 2022, 9:30 PM UTC

smegma2 wrote: post #18

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 holding should always be fine. No trading is happening therefore it's not insider trading.

Or more to the point: insider trading isn't quite as victimless as some people might like to believe.

The only victim "insider holding" could have would be people betting against a trend caused by public information (who would win even more if the "insider holder" would sell with the herd), either out of pure gambling desire or because their trades are insider trades. Neither seems particularly worthy of protection.

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

#93

Post by ribs » Mon, Mar 28, 2022, 9:30 PM UTC

udkl wrote: post #80

Quoted post unavailable.

No doubt there are lawbreakers in AP, just as they are in every other state, in every other place. That you’ve heard more or remembered more or paid more attention to those reports is of little to no material importance for grasping what is going on in the world or predicting what will happen next and who will do what.

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

#94

Post by kieselguhr_kid » Mon, Mar 28, 2022, 9:34 PM UTC

mynegation wrote: post #50

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…

[Edited to remove harsh phrasing]. Consider this: there is no upside from this comment and quite a bit of potential (although likely low probability) downside.

I think this is a fair criticism, but in all honesty a determined attacker would probably have better vectors both in terms of companies to trade against and in terms of people with access to actionable information.

Also worth noting there have been times I've thought the price should go up and it went down, and vice versa. While I have a good view into financials (and believe I would have made money insider trading, on the whole), it's not complete enough to warrant something like threats, blackmail, etc.

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

#95

Post by ethbr0 » Mon, Mar 28, 2022, 9:36 PM UTC

notch656a wrote: post #66

ethbr0 wrote: post #45

Earlier quoted context omitted.

See fair disclosure requirements https://www.investor.gov/introduction-investing/investing-ba...

At best that would only require you to disclose to everyone once asked by someone performing some research, or through the outlined regulation FD mechanisms. It still holds that using your own definition, all it takes is some research to gain what the employee who is willing to give up information knows, and that giving up the information can be done in a way that avoids violating regulation FD.

If you want to play chicken with the SEC like they're a D&D DM you're rules lawyering, be my guest.

Because while they may not prosecute often, I'd still rather stay off their radar.

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

#96

Post by rosndo » Mon, Mar 28, 2022, 9:38 PM UTC

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.

Indeed, insider trading benefits everybody by adding more information to the markets, leading to more accurate prices.

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

#97

Post by toast0 » Mon, Mar 28, 2022, 9:38 PM UTC

sidewndr46 wrote: post #55

ethbr0 wrote: post #21

Earlier quoted context omitted.

You're not supposed to do that at all. You could argue you didn't possess any material non-public information, but since essentially every internal document you access is non-public information, that's probably not an argument you want to deal with. Just trade your own company's shares in the windows after earnings releases. Or set up a pre-defined share sale plan in one of these windows, covering the future, and don…

> Or set up a pre-defined share sale plan in one of these windows, covering the future, and don't touch it. The insider trading training I did at one company specifically mentioned this is against SEC rules and is insider trading. I am unsure if that is actually true, but that is what the company expected us to operate as.

Setting up a 10b5-1 plan with your broker when you don't have material, non-public information, and your broker follows the plan is the way to trade in employer stock with a solid footing if you regularly have material non-public information. (Such as, in this case, a major change in business metrics).

Your company may not permit regular employees to setup a 10b5-1 plan, I think they need signof by corporate legal; and in that case, any trading that happens in your account could be considered insider trading based on your knowledge when the trade executes (or possibly when it's entered/while it's open... details are sort of fuzzy), regardless of if you or your agent made the trade, or even if the trade was automatic due to margin or something.

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

#98

Post by ethbr0 » Mon, Mar 28, 2022, 9:38 PM UTC

nebula8804 wrote: post #51

ethbr0 wrote: post #36

Earlier quoted context omitted.

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 nig…

>Being constantly coddled in some way dulls your ability to recognize when circumstances have changed, and those safeguards are no longer present. It will be interesting to see this happen nationwide if the music were to stop(or slow down) in the US economy as some are predicting.

That's what the 2008 crisis was at its root -- too many people, at all levels, who'd forgotten to be alert for danger and mistakenly assumed that the recent past served as fundamental bounds of future possibility.

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

#99

Post by supramouse » Mon, Mar 28, 2022, 9:40 PM UTC

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…

No post body was provided.

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

#100

Post by donatj » Mon, Mar 28, 2022, 9:41 PM UTC

> 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.