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Comment by yieldcrv

It is contingent on having a fiduciary duty with the issuing organization, just like your own source says. For non-directors, this duty comes in the form of confidentiality agreements that are part of standard employment contracts (but can take any form, and the wording must be evaluated by the prosecutors independent of the action they wish to prosecute).

Note, that it also relies on the thing being traded being a security. Which the DOJ here decided to avoid trying to figure out, by specifically not leveraging the insider trading fraud statutes.

And therefore they stick with the super broad wire fraud statute, the fraud part being extended to the breach of fiduciary duty. They otherwise wouldn't have a tool to prosecute this action that.

parent yieldcrv 4 years ago

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