On A Lighter Note…

 

You may have read recently how the Securities and Exchange Commission, with the help of hedge fund managers, uncovered and foiled an insider trading scheme by two Disney employees.

Here is a “Disney World” synopsis of what happened, written by a friend of this firm:???”Goofy and Dopey send letters to 20 hedge funds offering to give them an advance look at Disney’s quarterly earnings for a fee. ?Hedge fund compliance officers Mickey Mouse and Tinkerbell smell a rat so they immediately notify Winnie the Pooh at the SEC. ?Winnie the Pooh and FBI Agent Buzz Lightyear set up a sting operation leading to the arrest of Goofy and Dopey. ?????Captain Hook and Cruella DaVille will be representing Goofy and Dopey at their arraignment.”
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Here is a “real world” synopsis:

Two hapless Disney employees and wannabe insider trading tippers named Bonnie Hoxie and Yonni Sebbag emailed a number of hedge fund managers (all perfect strangers) offering to sell them non-public financial information that Disney intended to use during an earnings conference call in a couple of days.

The SEC released snippets of emails from Mr. Sebbag that did not exactly sound like the work of a brazen financial pro: “First of all, I am not a fed’. I work for Disney, that is all I can tell you’. I don’t think we will get caught if we stay discrete and careful. You can count on my discretion as I am counting on yours.”

The hedge fund managers quickly informed the SEC and cooperated in an FBI sting operation that nailed the idiots in short order. An FBI agent gave Yonni $15,000 in cash, and Yonni asked him how to set up an offshore account. The SEC issued a press release describing how it and law enforcement “acted quickly to stop this brazen attempt to establish an ongoing insider-trading business.”

It will be interesting to see how a ramped-up SEC deals with more serious financial crimes.