Martha Stewart Illegal Insider Trading Case

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Introduction The article titled “SEC Charges Martha Stewart, Broker Peter Bacanovic with Illegal Insider Trading” was the press release from the SEC on June 4, 2003 and presents the SEC’s position on the case. Background on the SEC The United States federal government that holds the primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation’s stock and options exchanges, and other activities and organizations, including the electronic securities market in the United States is call the U.S. Securities and Exchange Commission. The Securities Exchange Act of 1934 created the SEC that enforces the Securities Act of 1933 and several other statutes. The Securities Act was created in the aftermath of the stock market crash of 1929 and during the ensuing Great Depression. The primary purpose of the Act was to ensure that buyers of securities receive complete and accurate information before they invest. SEC Complaint The SEC filed securities fraud charges against Martha Stewart and Peter Bacanovic in federal court, in Manhattan. The complaint alleged that Stewart committed illegal insider trading when…show more content…
It is worse still when the individual engaging in an insider trading is the Chairman and CEO of a public company.” Furthermore, the Regional Director of the Commission’s Northeast Regional Office, Wayne Carlin said, “The Commission simply cannot allow corporate executives or industry professionals to profit illegally from their access to nonpublic information. The coordinated action announced today by the U.S. Attorney’s Office shows that the consequences for those individuals will be even greater if we uncover evidence that they obstructed our

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