Marc Powers Explains Why a Federal Insider Trading Law "Makes Little Sense"

News / March 20, 2017

Partner Marc Powers, National Leader of the Securities Litigation and Regulatory Enforcement, and Hedge Fund Industry teams, is quoted in an article published March 17, 2017, in RFG Weekly Roundup. The article, “What If You Could Draft an Insider Trading Law?”, is a roundup of opinions regarding a suggestion by U.S. District Judge Jed S. Rakoff that a statute prohibiting insider trading be drafted and passed.

Powers told the publication: “For me, in the United States, an insider trading statutory policy makes little sense. It will not likely clear up the ambiguity of what is, or is not, insider trading. How many statutes do we have on our books which are constantly subject to legal interpretation by the Courts? This is just part of our jurisprudence. Moreover, the legal landscape of judicially created law in the area of insider trading has been relatively clear. It has been the overzealous enforcement by the U.S. Attorney’s Office and SEC in seeking defendants who otherwise fall outside the parameters of established Supreme Court precedent that has created the lack of clarity.

“Moreover, any suggestion that we consider an EU (European Union) directive that prohibits all persons who are in possession of non-public information from trading is not consistent with our U.S. Federal Securities Laws. Our law are built upon the concepts of disclosure and duties, not equal access to all information. Indeed, the Supreme Court has rejected the suggestion of equal access.”

Read the article.