Insider Trading Case

Gambling is becoming increasingly popular in today’s society. Major casinos and online gambling sites attract

Social Although gambling industry can bring more employment opportunities and offer diversified leisure activities for the public, it could also lead harms. ‘Problem Gambling’ is the main disadvantage that gambling produced, it may result in an increasing number of personal bankruptcy, suicide, crime and child welfare may be ignored and so on (Williams, Rehm & Stevens, 2011). Hence, the Australian Gaming Council formulated the Responsible Gaming regulation to conduct the gambling industry in Australia and reduce the existing and potential harms.

Gambling can be found in places such as casinos, local stores, and online. Over the years, gambling has found more homes. College campuses and college sports are among the various places in which gambling is taking place. College students and more specifically student-athletes are engaging in gambling for various reasons. According to (Huang, Jacobs, Derevensky, Gupta, & Paskus, 2007)“the top 3 reported reasons for student- athlete gambling were “for fun” (75.6%), “to win money” (53%), and “for excitement (52.1%).” College students are participating in all types of gambling most of them being legal. Results from (Huang, Jacobs, Derevensky, Gupta, & Paskus, 2007) study show that “in regards to the types of gambling behavior engaged in by

According to the Federal Reserve, this act “...prohibits any person, including a business, engaged in the business of betting or wagering from knowingly accepting payments in connection with the participation of another person in unlawful Internet gambling” (31 USC 5361-5366). DraftKings and FanDuel are considered gambling websites because the game that they offer are of chance. The act does exclude season-long leagues, but daily leagues are not excluded. One reason this act was passed was to keep companies from taking all of revenue after payouts. DraftKings and FanDuel should not be able to operate because of the Unlawful Internet Gambling Enforcement Act of

Today, it is FanDuel and DraftKings who take advantage of the slow moving government and the unregulated system of daily fantasy sports. In an interview with Matt King, CFO of FanDuel, Walt Bogdanich, investigative journalist, states, “So you don't view what you do here at FanDuel as gambling,” and instantaneously King disagreed by saying, “No … Every time that you talk to our users, what comes through loud and clear is the fact that we're an entertainment product (The Fantasy Sports Gamble).” Basically, Bogdanich asks if King thinks FanDuel is gambling and he spontaneously disagrees that their product was just for the purpose of entertainment. Bogdanich goes on to ask if King believes that their product should be regulated, but King avoids answering with yes or no by saying that their product is all about entertainment value. Don’t get me wrong here, I don’t want to sound like someone who despises fantasy sports, but I just hate the fact that he’s only saying things that his lawyer allowed to him to

“Big” Tim Sullivan was the leader of an unofficial “gambling commission” in New York City. Members of the secretive commission included Frank Farrell (New York City gambling mogul), a State Senator, and the Chief of Police, Bill Devery. Every gambling house, policy shop, and craps game was charged at least $300 for a “license,” which was collected by the local precinct captain. There was no pretense with these “licenses” as there were no regulations in place to protect consumers. This was simply a lucrative bribery system amounting to $3,095,000 for the year of 1900, according to the The New York Times. Obviously, the ban on gambling wasn’t

Since the actions of the major online gambling sites promote, and will continue to promote, usage by individuals in states that outlaw online gambling, the sites should be illegal on the federal level since they violated the UIGEA.

Many people see fantasy sports as gambling, but there actually is a law stating that it in fact is not. There was a law declaring fantasy sports legal, it was introduced in 1999 and the last action of this law took place in 2006. People also see fans play games and win a large amount of money as if you would playing poker or another gambling game of the sort and they automatically think it’s gambling,

The unique presupposition of fantasy sports allows individual participants to act as owners or general managers of their own sports teams. These members participate in either an online or real-world draft scenario. Each

The Unlawful Internet Gambling Enforcement Act of 2006, or the UIGEA, had, in a nutshell, prohibited banks and payment processors from processing transactions that would correlate to online gambling. This has not only complicated loading accounts, but also withdrawing. While USA online casinos have continued to operate, they have had to use payment processors that would circumvent these restrictions. Sadly, the UIGEA was not even set to go into effect until December of 2009, thought the implications of the legislation had fall out that would be nothing short of catastrophic for many online gambling companies, especially those that relied heavily on the United States market.

The stock market is the market where shares of publicly owned companies are issued through exchanges or over-the-counter markets. Some individuals, such as R. Foster Winans, will attempt to cheat the stock market and make profits illegally through insider trading. Insider trading is an illegal activity where people will trade stocks based on confidential information. R. Foster Winans was charged with insider trading because of his knowledge of what would appear in the Wall Street Journal’s, “Heard on the Street Column.” R. Foster Winans got the punishment he deserved for insider trading on the stock market.

For example, Manna (1966) states that insider trading should be allowed because insider trading is the most effective way to compensate to insider to generate new economic information in firm. Hirshleifer() states that for insider, good information is as good as bad information to make profit but this profit may not be related to economic contribution of insiders in corporate. Proponents of insider trading suggest (Carlton and Fischel (1983) that insiders are the most informative member in the market, and by trading, they bring new information to the markets and causing prices to change toward their true value and, therefore, promoting the optimal allocation of resources. On the other hand, Scholars (Benabou and Laroqu, 1992) say that insider trading may provide incentive to corporate insiders either to delay the announcement of price-sensitive information to public or to prevent to release price sensitive information, which in turn makes stock prices less informative. However, Georgakopoulos (1993) argues that restriction on insider trading may have little adverse impact on market efficiency but it reduces the cost of transaction that burdens on uninformed traders

Corporate directors and officers often obtain advance inside information because of their positions. Sometimes the information can affect the future market value of the corporate stock. It is obvious that their positions can give them a trading advantage over the general public and shareholders. Often times the insider is the company manager; other times it is the company's lawyer, investment banker, or even the printer of the company's financial statement. Anyone who has knowledge before public dissemination of that information stands to benefit from good news or bad news.

Political and legal factors are those controlled by ‘governments, local authorities, or other trade or activity orientated regulatory bodies' (Brassington and Pettitt, 2000). Gambling legislation is put in place in order to prevent consumers been taken advantage and also help control consumers with gambling problems. The internet is open to great abuse in all areas of the internet and gambling is no exception. Within five minutes it is possible to be gambling on the internet at as high stakes as one desires, this obviously has its dangers. Companies have recently been pushed to be more responsible for caring for their customers. Some of the companies now have a system which its customers can use. The system offers the customer control of how much they can deposit in a designated time period, this helps the customers control their spending. Though this may affect profits for a company, it gives the impression that they care for their customers, which promotes their company. The laws for online gambling are reasonably relaxed and with it been a worldwide market that anyone from any country can access it is hard to control such a market. There have been recent worries about illegal gambling carried out on Betfair with trainers and owners regarding the running of a horse to lose. Many bets would be taken on the specific horse resulting

Most of us have heard of fantasy football. Online fantasy has risen in popularity over the past couple of years, due to advances in technology. With this rise in popularity, it has raised eyebrows at the state and federal government levels. There are many grey areas when it comes to gambling online, that many people still don’t understand. Many questions are being asked, such as legal transactions with credit cards, is online gambling causing a problem with a rise in gambling addiction? Over the course of this report, I will go over the good and the bad of making online gambling legal and regulated.