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> Because he has a fiduciary duty to the shareholders, and by selling his shares he is misappropriating company information for personal benefit. This was a sc

by dsacco 9y ago

> Because he has a fiduciary duty to the shareholders, and by selling his shares he is misappropriating company information for personal benefit. This was a scheduled sale. It's not clear to me what the SEC is seeking to investigate. Breaking a scheduled sale to take a loss is also illegal insider trading.

wmf 9y ago
He scheduled it after he knew about Meltdown.
bduerst 9y ago
So is your point that insider trading isn't bad, or that this isn't insider trading? Because the WaPo article linked to is about insider trading.
- dsacco 9y ago
  My point is that it's not insider trading. I also didn't link to any Washington Post article in my comment, so it's not clear to me if you responded to the right comment here.
  - bduerst 9y ago
    My bad - the OP was arguing that insider trading is a good thing, and the response was a criticism of that argument.
Natsu 9y ago
I believe that means it depends on whether the schedule was set before or after he learned of this information. Mind you, I honestly don't know whether the schedule was set before or after in this case.
ams6110 9y ago
But when was it scheduled? Intel has known of Meltdown/Spectre for some time (at least since June) and had planned an announcement for this week before the cat got out of the bag.
cybrjoe 9y ago
It was "scheduled" on October, 30th 2017.
- dsacco 9y ago
  The scheduling plan was adopted in 2015, according to Intel.
  - stonemetal 9y ago
    That is a bit of a red herring. He setup the automated trading schedule in 2015. In October 2017 he changed the rules of his automated trading schedule to dump his stock almost as if he was trading on insider information. http://www.forexlive.com/news/!/intel-ceo-reportedly-sold-39-million-worth-of-shares-after-learning-about-design-flaw-20180105 http://www.forexlive.com/news/!/intel-ceo-reportedly-sold-39...
ikeboy 9y ago
1. It was scheduled in October from what I can tell 2. >Breaking a scheduled sale to take a loss is also illegal insider trading. Source? I don't think this is correct - it is illegal to insider trade but not to refrain from trading. See e.g. https://www.statnews.com/2016/08/08/insider-trading-biotech/ https://www.statnews.com/2016/08/08/insider-trading-biotech/
- dsacco 9y ago
  The scheduling plan was adopted in 2015 according to Intel. Regarding the second point, yes it's a grey area. Refraining to trade when the trade is part of a scheduled plan in order to avoid a loss is insider trading if you have privileged information. In principle refraining to trade in general is probably illegal, but I admit that's a murkier area.
  - ikeboy 9y ago
    Elsewhere in this thread there are links showing this specific plan was changed in October. Intel can say whatever they want but it doesn't change what they publicly reported to the SEC. Do you have a source for your first claim that cancelling to avoid a loss is insider trading?
    - dsacco 9y ago
      > Do you have a source for your first claim that cancelling to avoid a loss is insider trading? Yes: https://www.sec.gov/rules/final/33-7881.htm https://www.sec.gov/rules/final/33-7881.htm. The purpose of a prearranged stock plan is that it's autonomous and outside the control of insiders with privileged, confidential information. Making any decision with regards to the plan once it has been adopted, either to trade or not to trade, voids that autonomy.
      - ikeboy 9y ago
        >the purchase or sale of a security of any issuer I don't see where they ban refraining from trading.
joshuamorton 9y ago
I believe the contention is that the scheduling too place after Intel was aware of the vuln.
smallnamespace 9y ago
> Breaking a scheduled sale to take a loss is also illegal insider trading. Actually it might be legal. Which doesn't make sense, because trading or not trading based on insider info has the same effective impact on the market, but it may not be 'insider trading' if you decide not to trade. 'After Rule 10b5-1 was enacted, the SEC staff publicly took the position that canceling a planned trade made under the safe harbor does not constitute insider trading, even if the person was aware of the inside information when canceling the trade.' It doesn't seem like Krzanich falls under this though because he went through with the sale. https://en.wikipedia.org/wiki/SEC_Rule_10b5-1#A_possible_loophole:_canceling_plans https://en.wikipedia.org/wiki/SEC_Rule_10b5-1#A_possible_loo...
megy 9y ago
It was a scheduled sale of 30,000, and he ended up selling 600,000 shares.

by dsacco 9y ago

wmf 9y ago

He scheduled it after he knew about Meltdown.

bduerst 9y ago

So is your point that insider trading isn't bad, or that this isn't insider trading? Because the WaPo article linked to is about insider trading.

dsacco 9y ago
My point is that it's not insider trading. I also didn't link to any Washington Post article in my comment, so it's not clear to me if you responded to the right comment here.
- bduerst 9y ago
  My bad - the OP was arguing that insider trading is a good thing, and the response was a criticism of that argument.

Natsu 9y ago

I believe that means it depends on whether the schedule was set before or after he learned of this information. Mind you, I honestly don't know whether the schedule was set before or after in this case.

ams6110 9y ago

But when was it scheduled? Intel has known of Meltdown/Spectre for some time (at least since June) and had planned an announcement for this week before the cat got out of the bag.

cybrjoe 9y ago

It was "scheduled" on October, 30th 2017.

dsacco 9y ago
The scheduling plan was adopted in 2015, according to Intel.
- stonemetal 9y ago
  That is a bit of a red herring. He setup the automated trading schedule in 2015. In October 2017 he changed the rules of his automated trading schedule to dump his stock almost as if he was trading on insider information. http://www.forexlive.com/news/!/intel-ceo-reportedly-sold-39-million-worth-of-shares-after-learning-about-design-flaw-20180105 http://www.forexlive.com/news/!/intel-ceo-reportedly-sold-39...

ikeboy 9y ago

1. It was scheduled in October from what I can tell 2. >Breaking a scheduled sale to take a loss is also illegal insider trading. Source? I don't think this is correct - it is illegal to insider trade but not to refrain from trading. See e.g. https://www.statnews.com/2016/08/08/insider-trading-biotech/ https://www.statnews.com/2016/08/08/insider-trading-biotech/

dsacco 9y ago
The scheduling plan was adopted in 2015 according to Intel. Regarding the second point, yes it's a grey area. Refraining to trade when the trade is part of a scheduled plan in order to avoid a loss is insider trading if you have privileged information. In principle refraining to trade in general is probably illegal, but I admit that's a murkier area.
- ikeboy 9y ago
  Elsewhere in this thread there are links showing this specific plan was changed in October. Intel can say whatever they want but it doesn't change what they publicly reported to the SEC. Do you have a source for your first claim that cancelling to avoid a loss is insider trading?
  - dsacco 9y ago
    > Do you have a source for your first claim that cancelling to avoid a loss is insider trading? Yes: https://www.sec.gov/rules/final/33-7881.htm https://www.sec.gov/rules/final/33-7881.htm. The purpose of a prearranged stock plan is that it's autonomous and outside the control of insiders with privileged, confidential information. Making any decision with regards to the plan once it has been adopted, either to trade or not to trade, voids that autonomy.
    - ikeboy 9y ago
      >the purchase or sale of a security of any issuer I don't see where they ban refraining from trading.

joshuamorton 9y ago

I believe the contention is that the scheduling too place after Intel was aware of the vuln.

smallnamespace 9y ago

> Breaking a scheduled sale to take a loss is also illegal insider trading. Actually it might be legal. Which doesn't make sense, because trading or not trading based on insider info has the same effective impact on the market, but it may not be 'insider trading' if you decide not to trade. 'After Rule 10b5-1 was enacted, the SEC staff publicly took the position that canceling a planned trade made under the safe harbor does not constitute insider trading, even if the person was aware of the inside information when canceling the trade.' It doesn't seem like Krzanich falls under this though because he went through with the sale. https://en.wikipedia.org/wiki/SEC_Rule_10b5-1#A_possible_loophole:_canceling_plans https://en.wikipedia.org/wiki/SEC_Rule_10b5-1#A_possible_loo...

megy 9y ago

It was a scheduled sale of 30,000, and he ended up selling 600,000 shares.