Jeff Barber writes:
IANAL, but I think you must be wrong about this, Perry.
Nope, I'm not.
If this were the case then, as an employee of company XYZ, I would never be permitted to buy XYZ stock (which is clearly not the case) since I *always* have information that others outside the company do not (about staff changes, product plans and such).
Funny, that, ain't it. Well, yes, as I noted, the law is very broad, and selectively enforced. However, yes indeed -- if you know that Secure Ware is introducing SuperBozo 2000 next week by virtue of your employment, and you know it will drive up the stock price, and SuperBozo 2000 is a deep dark secret, and you load up on shares in the expectation of making money from that rise, you are indeed cruising for a visit from the friendly boys at Stock Watch.
I suspect the deciding factor must have to do with the ability to execute actions which have substantial direct effects on the stock price (i.e. buying a company, declaring dividends, having a massive downsizing, etc.).
There is no real deciding factor other than what a jury will buy. The law is very broad and extremely vague. It is selectively enforced. A lot of what is and isn't a violation is based entirely on prosectorial discretion. Welcome to the world of securities regulation, where you live under a government of men, not of laws, and SEC edicts, er, no-action letters are needed before you sneeze because everything you do every day is probably a crime somehow. Perry