I don't understand, should the SEC only occaisionally enforce the laws? Would you prefer a situation where he was not prosecuted for insider trading, even though this is a crime he committed?
Are you suggesting that the SEC successfully enforces insider trading laws?
The SEC catches maybe 0.01% of insider trading. The inherent difficulty in enforcing insider trading has led many policy makers to push for legalizing the practice.
The more cogent question is, in light of recent revelations, why did they investigate this particular case instead of all the other potential cases?
Could he even tell them that he knew that the government contracts would fall because he refused to comply with the government? Would that be insider knowledge of something?
So they were going to crush his business and he tried to cash out? I don't know the whole story, but it seems that this is one of those cases where the SEC chose to occasionally enforce the law....
Would it be illegal for the companies that complied as they may have known that cooperating with the government would earn them lucrative contracts that their companies could benefit from?
It just doesn't seem right. Everyone else gets retroactive immunity and Nacchio goes to jail.
I would be fine with consistency. The SEC should not charge this man, or charge him and every person who is aware of any non-public government contract and trades in the sector the contract pertains to. Within reason, of course. Like, executives of all firms with (prospective or realized) government contracts, any time they buy or sell the stocks of their own firms, or grant themselves equity. Do we have any reason to believe that the law is enforced in this manner in general, or is it more likely that this is not the case, and it was enforced in an unusual manner in this particular instance?
The real question is why the SEC scrutinized him in particular. They do not have the resources needed to scrutinize everyone or catch everyone who engages in insider trading.
The SEC catches maybe 0.01% of insider trading. The inherent difficulty in enforcing insider trading has led many policy makers to push for legalizing the practice.
The more cogent question is, in light of recent revelations, why did they investigate this particular case instead of all the other potential cases?