Tuesday, June 20, 2006
Posted here is a recent discussion of the SEC Options Timing Probe. The LA Times here adds a new dimension to the discussion, by stating that "authorities confirmed that they also were looking into possible instances of so-called spring-loading." For a lesson on the terms being used here, check out Erik Lie's website here, where he defines springing-loading.
The bottom line may be whether insiders received an unfair benefit. Did they breach a fiduciary duty? Was there a deprivation of honest services? With broad federal statutes, this can be pretty frightening to those who lived obliviously in a pre-Sarbanes Oxley world. Is it a whole new game now? And will the government recognize the new arena and leave any improprieties found to shareholder or other civil lawsuits? Or will this become a criminal division matter? Stay tuned.