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SEC Charges Company Executive Chair for Insider Trading

By Randi Morrison posted 03-12-2023 05:12 PM

  

The SEC announced insider trading charges against a company’s executive chair for his alleged unlawful adoption of two Rule 10b5-1 plans and associated stock sales while in possession of negative material inside information involving the company’s relationship with its largest customer. The customer ultimately terminated its contract with the company, prompting a decline of more than 44% in the company’s stock price. According to the release, the executive chair avoided more than $12.7 million in losses as a result of his unlawful conduct. The DOJ announced parallel criminal charges.

See “Healthcare company leader abused 10b5-1 trading plan, SEC says” (Legal Dive) and “Healthcare CEO Faces Charges of Making Illicit Stock Sales in Prearranged Trades” (WSJ) and additional resources on our Insider Trading/Section 16/Rule 10b5-1 page.

                This post first appeared in the weekly Society Alert!

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