BU Now » insider trading

Galleon insider-trading probe widens

Dick Taffe — Thu, 15 Apr 2010 16:05:19 +0000

Widening the insider-trading probe involving Galleon hedge-fund founder Raj Rajaratnam, federal prosecutors reportedly now are examining if a Goldman Sachs board member gave inside information about the Wall Street firm during the height of the financial crisis. Law Professor Tamar Frankel, an authority on securities law and author of “Trust and Honesty: America’s Business Culture at a Crossroad,” says Wall Street players need inside information to do their jobs, but they must not trade on it.

“Pay that person more in salary and perhaps bonuses, but allow no trading or any financial transaction. And if culture does not dictate such an abstention, the law should impose it.”

Contact Tamar Frankel, 617-353-3773, tfrankel@bu.edu

SEC cracking down on insider trading

Dick Taffe — Wed, 02 Dec 2009 22:10:47 +0000

After fumbling the probe into Bernie Madoff’s multibillion-dollar fraud, the Securities and Exchange Commission reportedly is ramping up insider-trading investigations. Law Professor Elizabeth Nowicki, a former SEC and Wall Street attorney, says traders at hedge funds, investment banks, and brokerages should beware.

“The SEC has finally aggressively asserted itself — in what appears to be both a public relations move and a genuine effort to clean up insider trading and selective disclosure — to make the markets more fair for Joe Common Investor.”

Contact Elizabeth Nowicki, 617-353-2807, enowicki@bu.edu

Countrywide ex-CEO charged with fraud

Dick Taffe — Fri, 05 Jun 2009 15:03:23 +0000

The SEC is charging mortgage pioneer Angelo Mozilo, the ex-CEO of Countrywide, with fraud and insider trading for actions that triggered the sub-prime meltdown. School of Law Professor Tamar Frankel, an authority on securities law and legal ethics, says it’s about time the feds went after the big fish instead of just the “small fry” because it’s clear signal to leaders that such action is unacceptable.

Contact Tamar Frankel, 617-353-3773, tfrankel@bu.edu

First SEC case alleging credit-default-swap insider trading

Dick Taffe — Wed, 06 May 2009 16:01:39 +0000

Law Professor Tamar Frankel, an authority on securities law and legal ethics, applauds the Securities and Exchange Commission for bringing its first insider-trading case involving the unregulated financial world of Credit Default Swaps.

“It makes good sense for the SEC to start prosecuting in the area of credit swaps. First, one can learn a lot about this shadow market. Second, one can find out how much this shadow market engaged in violations of existing laws. Only then can regulations be drafted.

“Such regulation need not deal with insider trading — which is already prohibited — but focus on the freedoms from constraints that the actors in these shadow markets had, and how they abused this freedom. Those abuses would then be subject to regulation.”

Contact Tamar Frankel, 617-353-3773, tfrankel@bu.edu