Markets & Stocks
Insider trading persists
October 16, 1996: 8:48 p.m. ET

Although cases of the '90s are small, regulators still pursuing violators
From Correspondent John Defterios
graphic graphic
NEW YORK (CNNfn) - Insider trading was big news in the 1980s when the exploits of Ivan Boesky and Michael Milken were making headlines.
     While no high-profile insider trading cases have surfaced recently, that doesn't mean it's a thing of the past. Federal regulators want everyone in the securities industry to know they are pursuing just as many cases as they did a decade ago.
     The Securities and Exchange Commission said it still pursues about 45 insider trading cases every year -- about the same number as during the go-go 1980s.
     William McLucas, director of enforcement at the SEC, said although news about insider trading may periodically fade, it's something that his agency will always be combating.
     "It's not the type of activity where you can declare a victory and assume you have wiped it out entirely. Unless we keep an active presence in the marketplace, we will continue to see people take advantage of insider information," he said.
     Regulators say the brisk pace of mergers and acquisitions is behind a lot of insider trading now. In the past, trading ahead of simple corporate news was more common.
     Jim Cangiano, senior vice president of market regulation for the National Association of Securities Dealers, said as regulators have cracked down on criminal activity at the big firms, it has spread to smaller investors. (190K WAV) or (190K AIFF)
     These days, new insider traders can be harder to catch because they handle smaller amounts of money and have looser ties to the company in question.
     More sophisticated criminals are also a big challenge to regulators. They are now using offshore accounts to hide activities like the recent, suspicious trading that took place before The Gillette Co. took over Duracell International Inc.
     In response, major stock exchanges have installed computer systems that will flag even the smallest trade irregularities. Enforcement treaties with other countries have also been beefed up to make sure nothing slips through the cracks.Back to top


SEC hunts inside traders - Sept. 17, 1996


U.S. Securities & Exchange Commission

Welcome to Duracell USA

Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney