Len Boselovic’s Heard Off the Street: Computer geeks, too, can be charged with insider trading, Pittsburgh Post-Gazette ft. George Meierhofer
George Meierhofer, partner in KDV’s New York City office, is quoted in an article published by the Pittsburgh Post-Gazette on March 15, 2015. In the article Mr. Meierhofer comments on the SEC’s case against two Capital One employees who used the company’s database for insider trading purposes.
Mr. Meierhofer believes the case could have implications for other investors who mine data looking for actionable information.
For example, a hedge fund could hire a firm to analyze databases for usable information and have no idea whether it was receiving public or nonpublic information, making it difficult for the SEC to prove whether the hedge fund acted with fraudulent intent when it traded securities using the information, he said.
“People who use these data mining services will be getting an advantage over others in the market,” Mr. Meierhofer said. “[The SEC] may have to come up with a new theory of insider trading liability to address this concern.”