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Sunday, October 01, 2000 3:27:25 PM

Re: myDDdotcom post# 668

Post# of 1019
OT: Insider trading regulations not only applies to the typical insider, but it also applies to employees, such as engineers, accountants or others who acquire material information from a corporate source. These persons are considered 'temporary insiders.' The Dirks test holds tippees liable if a) insiders have breached their fiduciary duty to the corporation by disclosing that information and 2) the tippee knows or should know of that breach (Roszkowski 879- 80). To supplement Rule 10b- 5, Congress enacted the Insider Trading Sanctions Act of 1984 and the Insider Trading and Securities Fraud Enforcement Act of 1988 to control insider trading. Texas Gulf Sulfur (1965), the SEC went into court attempting to force repayment of insider profits not only by actual insiders, but those who obtained information from insiders that had not been publicly released. This was a landmark case where the SEC extended liability to the tipper and the tippee.

Do not tell me that those here who claim to be trading for a living, or in other ways act as if - are not knowing the rules.



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