[n2d4]

> MNPI with you directly.

Abbreviating that is so misleading, it's incredibly hard to not see it as bad faith! MNPI means "material non-public information". You're saying "non-public information is fine but material non-public information is not", without making it as obvious.

Yes, it has to be material. "Owes $30b in taxes" is ABSOLUTELY material. If on top of that you learn about it from IRS insider contacts, enjoy your time in prison.

Please do read the Wikipedia article; it has a section on the US. https://en.wikipedia.org/wiki/Insider_trading

> SEC regulation FD ("Fair Disclosure") requires that if a company intentionally discloses material non-public information to one person, it must simultaneously disclose that information to the public at large.

[gizmo]

The entire point is that MNPI is a legal concept and information can be both nonpublic (i.e. private correspondence) and tradable for profit (i.e. material) and yet does not constitute MNPI.

You're making the exact mistake that I've repeatedly tried to correct. There is no bad faith on my part.

[n2d4]

Your personal opinion on what "material" means might differ from the court's (and also differs from mine, at least how you phrased it), but I can assure you, a $30bil tax bill is DEFINITELY material.

It's a "legal concept" in the same way that every word used in a lawbook is a legal concept; the US is based on case law, and there is a large amount of precedent for this definition in particular. Again, refer to the Wikipedia for some examples.

I see this mistake a lot among programmers (also myself at some point). They (we) naturally think law is like a rulebook where you go through a decision tree and then arrive at a perfect conclusion, but the truth is that it's up to the courts to decide on the specifics. And they might disagree on those things with you, and with each other, but in the egregious cases disagreements are rare.

[gizmo]

The SEC takes enforcement action in about 40 insider trading cases in a typical year. Most result in fines. Less than half of those cases get forwarded to the justice department. Big "egregious cases" of insider trading cases are practically unheard of. And that's not because wall street is especially virtuous.

Remember that agencies like the IRS, FDA, SEC must not leak a single bit of information (investigation/no investigation). Because that single bit is sufficient to profitably trade on. A hedge fund doesn't need to know the specifics or the exact date of an enforcement announcement in order to make out like a bandit. A tiny amount of signal is sufficient. In fact, a tiny amount of signal is preferred. If a firm knows for a fact that MSFT is in trouble with the IRS they can't trade on it. But if a little bit of information leaks from an agency, that's gold.

[JumpCrisscross]

> that's not because wall street is especially virtuous

It's because insider trading is a generally stupid crime. If you're on Wall Street, there are better ways to make money. The people who insider trade are largely those who think Wall Street is constantly doing it--it's an old joke in finance.