Case Studies

Latisha King

Bus 220

July 9, 2015

Case 12

1.) Information gathering techniques are very common on Wall Street. Rajaratnam gathered

information by attending meeting, through phone calls, and also texts. Being that he received that information so easily, I feel like it is very common on Wall Street because it is the easiest way for people to make their money.

There were accusations that insider trading was taking place at Galleon. The company managed to bring in abnormally large amounts of money and Rajaratnam got in trouble with the government. Regulators, investors, and executives can try and keep track of the information they are distributing and being aware of money transactions. If there is suspicion of someone using any form of information gathering, they should be monitored and aware that there are consequences that follow their action. Even if they try to stop the illegal practice, people will find different way to hide it. There is not a certain way to reduce the practice of information gathering techniques.

2.) Sharing confidential information is illegal. If people are caught giving out information that is not supposed to be leaked to the public, they could be prosecuted. Using information from the inside that is illegal is unethical. Although some people unknowingly use the information, others use it and know that is illegal. It just goes back to the basics and people will do anything for money.

If I had illegal information about that stock, I would try not to make any decisions in relations to that stock. I would be hard not to react and make decisions that would bring in revenue, but if things boiled down, I would possibly get in trouble for having that type of information. Knowing from inside sources that a stock would possibly decrease in a certain amount of time, that would determine if I felt comfortable with investing my money into that stock. Having confidential information on a company greatly affects the decisions of how to trade...