Insider Trading Ahead of Cyber Breach Announcements

On March 14, 2018, the Securities and Exchange Commission charged a former chief information officer of Equifax with insider trading. The complaint alleged that he profited from selling stock ahead of the September 2017 public announcement of a major cybersecurity breach at the company involving the data of 148 million customers. The high-profile nature of the incident prompted federal prosecutors to investigate how much of this sort of insider trading may be occurring.

In a recent Wall Street Journal Online article, William Hinman, a senior SEC official, states that the agency intends to clamp down on this practice. He suspects … Read more