Unauthorized Trading Activities And Risk Management Practices

The fact that the insider trading charges were thrown out, but the conspiracy charges stuck is curious. It appears, yet again, the judicial process and mainstream social construct of acceptable behavior collided with what Martha, her broker, and fellow investor touted as ‘nothing wrong’. Knowing more of John Savarrese’s role as Martha’s pretrial counsel, gives two more important points about Martha’s case of white collar crime. The first is questionable ethics and the other is arrogance. Mr. Savarrese has been criticized by legal analysts for not providing ethical legal advice to Martha or making the right professional choices himself. The belief is that Savarrese knew or at least suspected, Martha and Bacanovic planned to perjure themselves. As Martha’s legal counselor it was ethically negligent of Savarrese not to advise Martha of the legal repercussions of lying to the SEC. If Martha insisted on presenting her fraudulent story, Savarrese should have immediately withdrawn as her counsel (Hoffman, 2007). More importantly than if Savarrese knew or not, in her arrogance, Martha never thought this issue of a mere $45, 637 would develop into charges nor a prison sentence! She was simply above the laws and saw no reason to tell the

When assessing the economic damage to due to Paul Thayer and those that he tipped off about the acquisition of Campbell Taggart, it should be noted that some argue that this kind of insider trading circulates information and forces the stock to its “true value.” If we assume this argument to be flawed, then part of Anheuser-Busch stock dip after the announcement was due to the insider trading and the fact Anheuser-Busch probably paid more to acquire its target. Thayer and his friends trade the Campbell stock for nearly a month before any public announcement of the merger. On July 27 nearly half the volume was insider volume controlled by those individuals who were in violation of rule 14(e)-3 (See exhibit 2). The increased volume might

The question before our society is not whether corporate crime is a victimless crime, rather the question is what should be done about it? Corporate crime doesn’t just do harm to the investors that can be unknowingly damaged by these crimes, it has a much more insidious nature to it as it has done harm on global scales. Corporate crime is almost a misnomer because many of these criminal wrongdoings are for the most part legal, when not taken to their ultimate conclusion. Society within the United States has been taught that the man in the brief case, yelling at other men in dark coats on the flow of the stock exchange are the smartest guys in the room. This paper will attack that idea on many levels, the first salvo will be

In 2008, the world experienced a tremendous financial crisis which rooted from the U.S housing market; moreover, it is considered by many economists as one of the worst recession since the Great Depression in 1930s. After posing a huge effect on the U.S economy, the financial crisis expanded to Europe and the rest of the world. It brought governments down, ruined economies, crumble financial corporations and impoverish individual lives. For example, the financial crisis has resulted in the collapse of massive financial institutions such as Fannie Mae, Freddie Mac, Lehman Brother and AIG. These collapses not only influence own countries but also international area. Hence, the intervention of governments by changing and

Any individual who goes against any kind of provision of the title or perhaps the established standards or laws by purchasing or selling a security during possession of materials, i.e. confidential or non-public facts will be accountable for those actions in a court law. The person will be liable to answer in any skilled jurisdiction structure to the individual who, contemporaneously used the purchase of securities which was the subject of aforementioned breach, has bought or sold securities of the same stature. In case the individual has bought the securities, the situation is such that the law suit or violation is dependent on the securities sales ratio and where the individual has sold these securities, the law suit or breach is dependent on a selection or purchase of the

A trend that has recently emerged as a violation of section 10(b) is the use of the internet to engage in pumping and dumping. Although not a new concept, the internet has been used to increase the effect because of its ability to disperse particular company information very quickly in order to affect stock prices. Persons initiating this deceptive behavior can sell their stocks for profit once they see that the changes to price have occurred. This type of behavior is considered fraud since it is a manipulation of

88 Case 1.12 Madoff Securities Instructional Objectives 1. 2. To identify the principal precursors of financial fraud. To identify “red flags” or risk factors typically indicative or symptomatic of fraud.

Insider dealing has been affecting the efficiency of stock markets in different places like United States, United Kingdom and Australia. Hong Kong is of no exception. Basically, insider dealing refers to the trading of a corporation’s stock or other securities by individual with potential access to non-public information of the company. The law of insider dealing in Hong Kong provides a much more detailed definition and is very comprehensive. However, when it comes to enforcement, it seems not very effective. In the following, the law of insider dealing in Hong Kong will be summarized. After analyzing the comprehensiveness of the law, the underlying reasons of the difficulty in enforcement will be identified. Some

Violations that threaten legitimate trade comes in all shapes and items, "piracy is high in payoff and low in risk for both groups, often taking place under the radar of law enforcement"(Treverton et al, 2009 iii). Just this past Christmas there was and it still is a big deal about hoover boards. It is believed that some of the boards are counterfeit with cheap and unregulated parts, and these appear to be the ones catching on fire. You can actually view one catching fire on YouTube. Several schools and universities have made them illegal to ride on campus because of this danger. All kinds of products can be duplicated or a knockoff but carry a certain name brand, such as Citizen or Rolex watches and more of the common ones you may see

According to Daniel F. Dooley (2008), a member of the Commercial Fraud Taskforce, financial fraud with private middle-market companies is on the rise. In fact, Mr. Dooley believes that he has seen more instances of fraud in the past two years than in the previous ten. He notes seven areas in which financial fraud has increased over the past few years:

For this assignment, use the Internet to research high-risk investment brokerage firms that have been indicted or convicted of ethical violations to provide insight and understanding of this market segment.

In today’s society crime occurs everyday across all aspects of life. One particular crime is that of white collar and corporate level crime. It is important that we as a society study this type of crime in depth because many individuals believe that white collar and corporate level crimes are victimless crimes when in reality they have the potential to destroy major corporations and economies all with one single case. The news or media rarely talk about this type of crime because it is often difficult to understand and individuals typically lack interest in these types of cases. One particular case is that of Jordan Belfort. Dubbed the infamous “Wolf of Wall Street” Jordan Belfort is a former stockbroker who robbed investors of over $200 million dollars to create his wealth through “pump and dump” schemes, insider trading, money laundering securities fraud, and stock-market manipulation. As an attempt to further understand these complex cases I will break down Belfort’s case as far as the methods and means as to how he got started, his use of “pump and dump” schemes and other means as to how he acquired his wealth. In addition to this I will discuss the sanctions and disciplinary action that Jordan Belfort was given, how the case affected society and what new regulations were

In an economy which is globalized to such an extent it is difficult to know all the linkings, and the connections between events and institutions are often impossible to predict. Many countries in Eastern Europe, for instance, are still heavily reliant on Greek banks, and if those banks collapse the EU faces the risk of a chain reaction of financial turmoil that could easily spread to the rest of the global economy (TIME, June 29, 2015).

Darrow observes that while certain criminals are behind bars because they have obtained money under false pretenses, newspapers are full of deceptive advertisements, yet those who place them often trade freely. Darrow is right that some people enjoy the right to trade under false pretenses because people accept their deceptions as mainstream, while other people are thrown in jail for participating in similar activities.

Sectoral Slumps. A slump in the sectors where financial institutions’ loans and investments are concentrated could have an immediate impact on financial system soundness. It deteriorates the quality of financial institutions’ portfolios and profitability margins, and lowers their cash flow and reserves. In transition economies, these problems may also arise due to lack of progress in the restructuring of state-owned enterprises.