Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 1 of 1
Full-Text Articles in Law
The Blindsided Insider: Insider Trading Liability For Supervising A Rogue Trader , Adam Felsenthal
The Blindsided Insider: Insider Trading Liability For Supervising A Rogue Trader , Adam Felsenthal
Cleveland State Law Review
In the past few years, federal prosecutors and the Securities and Exchange Commission (SEC) have engaged in the widest-ranging and most successful probe of insider trading ever, focusing in particular on investment professionals. However, the government has failed to charge anyone on the basis of supervisory liability, essentially an accusation of failing to notice and stop illicit trading done under one’s supervision. This Article discusses all of the potential ways in which prosecutors could bring such a charge, ranging from SEC administrative liability to civil and criminal charges. Through the lens of a theoretical situation in which an “innocent bystander” …