[1] https://www.washingtonpost.com/news/wonk/wp/2013/07/26/insid...
Google disclosed the vulnerability to Intel in June. On October 26th, Intel filed its quarterly numbers and made no mention of Project Zero or the word "vulnerability." It failed, in Item 1A, to disclose any new risk factors [1]. On October 30th, Krzanich gave trading instructions [2]. On November 29th, the trades occurred; on December 1st, their confirmations were disclosed [2].
I'm not an expert on the sale of stock in public companies by insiders. But implementing sale instructions after finding a material risk factor and failing to disclose it in a subsequent filing looks shady.
(I continue to default to the assumption of sloppiness over bad intent, though even that is punishable, albeit with fines versus jail time.)
[1] https://www.sec.gov/Archives/edgar/data/50863/00000508631700...
[2] https://www.sec.gov/Archives/edgar/data/50863/00011276021703... Explanation 1
If you care that little about equality why not go all the way and just say laws don't apply to the rich, not just in fact but by law.
The only point of having laws is prevent people with power from amassing ever more power and hurting others. Without that there would be no reason for anyone to not take whatever they can the moment they get an opportunity
Insider trading laws don't stop this from happening. People not considered "insiders" can impact the price of stock. For example, in 2007 Lululemon stocks took a temporary dive when their seaweed claim was challenged:
"Not so, says the New York Times, which commissioned its own test after a Lululemon investor, who is shorting its stock, supplied the paper with lab results."
That, of course, doesn't include market professionals:
"Market professionals gain disproportionately from bans on insider trading because they are in a position to act on information that insiders cannot use, and can do so more quickly than any other group, including shareholders" [1]
[1] https://books.google.com/books?id=l9PuCAAAQBAJ&pg=PA161&lpg=...
Of course. The Intel CEO sells stock to investors without telling them that there is a vulnerability that makes the stock worth much less than they think, thus hurting these investors. Sounds intuitive, right?
The investors he sells to had already sent an order to buy to their broker. They were going to buy at the same or worse price anyway, so they aren't harmed by this. Someone else is harmed, but that's the market professionals who, months later, don't get an opportunity to profit off of the news before everyone else. I'm sure economics not being intuitive has something to do with why democracies end up with bad policies all the time.
B: you've moved the goalposts. I said it hurt others when they sell based on information they know as an employee, of the company whose stock they are selling. You are arguing that its fine because those people would probably be hurt anyway. If it was really fine then why didn't the CEO tell everyone about the vulnerability before making the sale? Those investors would have just bought it anyway, right?
This was a scheduled sale. It's not clear to me what the SEC is seeking to investigate. Breaking a scheduled sale to take a loss is also illegal insider trading.
Because the WaPo article linked to is about insider trading.
http://www.forexlive.com/news/!/intel-ceo-reportedly-sold-39...
2. >Breaking a scheduled sale to take a loss is also illegal insider trading.
Source? I don't think this is correct - it is illegal to insider trade but not to refrain from trading. See e.g. https://www.statnews.com/2016/08/08/insider-trading-biotech/
Regarding the second point, yes it's a grey area. Refraining to trade when the trade is part of a scheduled plan in order to avoid a loss is insider trading if you have privileged information. In principle refraining to trade in general is probably illegal, but I admit that's a murkier area.
Do you have a source for your first claim that cancelling to avoid a loss is insider trading?
Yes: https://www.sec.gov/rules/final/33-7881.htm.
The purpose of a prearranged stock plan is that it's autonomous and outside the control of insiders with privileged, confidential information. Making any decision with regards to the plan once it has been adopted, either to trade or not to trade, voids that autonomy.
I don't see where they ban refraining from trading.
Actually it might be legal. Which doesn't make sense, because trading or not trading based on insider info has the same effective impact on the market, but it may not be 'insider trading' if you decide not to trade.
'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.'
It doesn't seem like Krzanich falls under this though because he went through with the sale.
https://en.wikipedia.org/wiki/SEC_Rule_10b5-1#A_possible_loo...