Mark Cuban charged in insider trading case

Mark Cuban, Internet entrepreneur and owner of the Dallas Mavericks, was charged with insider trading Monday related to the stock of an online search engine, the Securities and Exchange Commission said.

The SEC alleges that in June 2004, Mamma.com Inc. invited Cuban to participate in a stock offering that would be conducted at a discount to the company's prevailing market price.

Within hours of receiving this information, according to the civil complaint, Cuban called his broker and instructed him to sell his entire position in the company. By selling his stock before the public announcement of the offering, Cuban avoided losses of more than $750,000, the SEC said.

Messages for Cuban and his legal representatives were not immediately returned.

It's unclear how the civil charges will affect Cuban's ability to continue to participate in the sale of the Chicago Cubs, owned by Tribune Co.

Look for them to crucify him publicly to take some of the heat off all of this bail out bullshit and to protect the old guard.

i've never understood why this was illegal.

me neither

Because you're acting on knowledge that isn't available to the public. Unfair advantage.

Me neither.

It makes no sense. It's illegal to make a smart choice about your investments when you hear taht there might be a good reason coming up to get out of them ahead of time?

That's like making preventative doctors visits illegal, or making you sit down and eat your meal at a restaurant before telling you how much it's going to cost or what the ingredients will be.

by this logic, all sports teams must announce their intended upcoming play ahead of time, so that the opposing team can prepare.

that's just fucking stupid.

You can't be serious? So when I receive notification this morning from the EPA that they've discovered my company pumping caner aids into the river and that they'll be holding a press conference tomorrow to announce it, it's ok for me to sell all my stock to you who has no idea that this is coming?

The Stock Market is little more legalized gambling. Most of the time, the House takes you. It's your own risk.

Shit! What company do you work for?

Except there are rules. Insider trading rules that Cuban knows about.

Whether the rules are "fair" or not doesn't really matter.

Super Cancer AIDS Fire Protection Devices, Inc.

Here's all the info

http://www.forbes.com/business/2008/11/17/...7cubantext.html

sorry - we're not hiring.

Yeah. One time I was at foxwoods playing blackjack. The dealer kept both cards down. They're suppose to show one. He showed it to 2 people at the table but not me and my friend. Prick.

Oh, I get it.

and really - watching Mark Cuban go down will be fun. I fucking hate that guy.

But lots of times it seems to me that paying heavy fines/losing your business in insider trading cases would make more sense than incarceration.

I just want to see him bitching in court like he does on the sidelines.

If he mishandled the cards, and you got a peek at them and knew where you stood in that hand, would you bet based on what you saw, or pretend to not see it and bet stupidly?

Maybe he can have a reality show where inmates compete to be his special friend

I hope he shows up in court wearing a Boston Kunckleheads t-shirt.

Yes and no. Sometimes it's silly. I thought the Martha Stewart thing was. But the rules are intended to stop say a big wig at a company from selling or buying his shares with inside info before the public knows the same info. Makes sense. If not, you have more organized white collar crime than that already exists. From the initial story it seems Cuban could be getting a bad rap but then that other link makes it appear that he was told and did not comply. Should have waited for the second the announcement hit and then sold. Kind of stupid for a guy who seems to get it. He was savy on not wanting to buy more of a company that was screwing their shareholders (Cuban) but didn't know he could get screwed even more for insider trading? Doesn't make any sense.

he gave a million bucks to this chick so she would be his friend

I blame it on white man's guilt.

Touche Mr. Vermin.... touche.... You win this round.

and I guess that's kind of my thing with the whole idea of insider trading. If you're actively looking for reasons to dump stock, that's bullshit, and should be prosecutable. But if someone happens to slip up and let you know something ahead of time that isn't yet public knowledge, how is that really your fault? And if it's not - why should you be liable for their loose lips?

Seems to me they should be going after the information leaks.

I agree with your scenario especially for the average investor. Most don't even know they might be liable.

But this case seems to be different than that.

Insiders are privy to info because they have an ownership deal. In this case, it wasn't loose lips. The company was looking for new financing/money/capital. Cuban as a big stakeholder got the call and was told the deal. This isn't loose lips but how big business works.

He didn't like it and said he was going to sell his holdings. Which is fine. But then they told him he couldn't sell until the news on the new round of financing was public which probably meant he had to wait a few days. He didn't comply or wait. That's the issue. Nobody slipped but Cuban. I'm not a big fan of insider trading rules that make any investor a potential target but when you are an insider owner and you got inside info from the top and were told that you could not sell without violating the law?

The rule should be enforced in this type of case.

I talked with Cuban's brother a few times via the internet. Seemed to be a good dude. Cool to me anyways.