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Insider trading has been running rampant on Wall Street and now the SEC has sent a Wells Notice to David Li, a board member of Dow Jones for insider trading and leaking information about the Rupert Murdoch's News Corp (NYSE: NWS) bid for the company. David Li is Chief Executive of the Bank of East Asia -the third largest bank in Hong Kong so he is a little harder to get, but that is why they are filing suit.
Insider trading has given me plenty to talk about in recent blogs. Dow Jones (NYSE: DJ), aQuantive (NASDAQ: AQNT), Hilton (NYSE: HLT) and Energizer (NYSE: ENR) are a few of the companies I have spotted funny activity on recently.
Trading with inside information is illegal and everyone knows it. But it can also be very profitable. If you know what you are doing you can get 100%, 300% or 5,000% returns over night. Some of the options traded on Dow Jones had an over 5,000% return. Options bought for 30 cents became worth $15. If you have insider information and know what you are doing it can be like picking the winning lottery numbers. However, it does not take long for people to get suspicious, as it is sort of like winning the lottery multiple times in a row. Many times the illegal activity takes place and then it becomes a game of moving the money around, but sometimes the SEC catches up.
I hope the SEC gets hold of Sir David Li and throws him in stocks. No not the kind he was trading in but the kind medieval criminals were put in. As someone knighted and with a honorary Doctorate Degree from Cambridge, he should know better. Some may say insider trading seems like a victimless crime, but those investors who had their stock called away were wrongfully robbed of the higher buyout prices. It is truly sad some of the individuals who have been caught doing this in recent years. They are smart educated successful individuals who should know better. They deserve the punishment they get for knowingly breaking the law.
I was checking the board on the company he works for,but now he can add common "crook" to his biography. I think "Crook" should go between "The Order of the Rising Sun" and "Gold Rays with Neck Ribbon." I kid you not... Check this out...
"Dr. The Hon. Sir David LI Kwok-po, GBM, GBS, OBE, MA, Hon. LLD (Cantab), Hon. DSocSc, Hon. LHD, Hon. DBA, FCA, FCPA, FCPA (Aust.), FCIB, FHKIB, FBCS, CITP, FCIArb, JP, Officier de L'Ordre de la Couronne, Grand Officer of the Order of the Star of Italian Solidarity, The Order of the Rising Sun, Gold Rays with Neck Ribbon,
(Chairman & Chief Executive)"
i am sure there will be plenty more before this saga comes to an end...
Kevin Kersten is an Options Analyst with InvestorsObserver.com. Do you have any deadwood in your portfolio? Check out the 18 Warning Signs That Tell You To Dump A Stock. Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.
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