Hacker May Get To Keep Insider Trading Windfall -- Because He Obtained Info Illegally

from the say-that-again dept

The NY Times is covering a bizarre anomaly associated with "insider trading laws" in the US that may allowed a guy to keep the nearly $300k he scammed by hacking into computers to learn of earnings info before it was actually released. Apparently, the way US securities laws work, if you legally obtain the insider info, you can't trade on it. However, if you illegally obtain the info, you can trade on it, though you're certainly potentially liable for the illegal actions that allowed you to get the info. In this case, the illegal actions were breaking into this computer. However, rather than being charged with computer fraud, he was charged with insider trading. In other words, he was basically charged with the wrong crime, and that may mean that he gets to keep the $300k and go on his merry way.

Filed Under: hacking, insider trading


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  1. identicon
    TriZz, 19 Feb 2008 @ 7:26am

    Re: Loophole closed?

    Nope. If I punch someone in the face...and they charge me for stealing his wallet, even though I didn't. They can't come back and say "well, you didn't steal his wallet, so we're gonna charge you now for punching him in the face". THAT is the definition of being charge for the same crime twice.

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