SEC to Provide Better Monitoring of Insider Trading in 2008
The U.S. Securities and Exchange Commission (SEC) has made a new years resolution: clamp down on Insider Trading in 2008. This, in response to a critical report of the SEC conducted by the Government Accountability Office which acts as the investigative arm of Congress. Essentially, the SEC will provide closer scrutinize to lower-level regulators that police brokerages and stock exchanges like the New York Stock Exchange and Nasdaq. These regulators known as self-regulatory organizations (SRO's) typically conduct internal audits themselves to curb insider trading, but now the SEC will make better use of their audits by improving their computer systems so as to make more use of referrals and advisories that it gets from SRO's on possible insider trading problems and other potential misconduct.
There was an upsurge in Insider Trading cases in 2007 which caused one senior SEC official to state, "insider trading appeared to be "rampant" among Wall Street professionals". The New York Times also noted that much of the rise in Insider Trading involved "pillow-talk" cases...insider-trading between husbands and wives.
