11 ms·

Former Equifax Manager Charged with Insider Trading

247 points by moonka 8y ago

jfim 8y ago
> To settle the SEC’s civil charges, Bonthu has agreed to a permanent injunction and to return his allegedly ill-gotten gains plus interest. It doesn't seem very dissuasive to only have to return the ill-gotten gains for insider trading, as it makes the returns of such trading positive if not all insider traders are caught.
- JumpCrisscross 8y ago
  "In a parallel proceeding, the U.S. Attorney’s Office for the Northern District of Georgia filed criminal charges against Bonthu" [1]. [1] this press release
- posixplz 8y ago
  A permanent injunction is a pretty big deal. I didn't want to spend the time finding the actual court filing corresponding to this press release, but 99% of the time, a "permanent injunction" in this context means a lifetime ban from the sale or offering of securities. Not such a big deal for the average Joe Sixpack, but in tech, where we're often paid in RSUs, options, and grants, it's a huge deal. Plus, there's the felony criminal record that will dissuade employers that aren't publicly traded.
  - donald123 8y ago
    Isn't the settlement with SEC to avoid the criminal record? Besides it's supposed to be a civil charge by SEC.
    - posixplz 8y ago
      You're right, my mistake. Insider trading can be charged criminally. To be precisely correct on this case, we'd need to read the plea filing. The defendant's name is also public record, so while a criminal record search may not ding him, a regular search engine query sure will. :)
      - 783629gasd 8y ago
        Yes insider trading can be charged criminally, but there's no actual statute prohibiting it, surprisingly: "For example, Section 16 of the Securities Exchange Act of 1934 requires the disgorgement of short-swing profits by named insiders—directors, officers, and 10% shareholders. The 1934 Act’s general antifraud provision, Section 10(b), is frequently used in the prosecution of insider traders. Although the statute does not specifically mention insider trading but, instead, forbids the use of “manipulative or deceptive” means in buying or selling securities, case law has made clear that insider trading is the type of fraud that is prohibited by Section 10(b)" (https://fas.org/sgp/crs/misc/RS21127.pdf https://fas.org/sgp/crs/misc/RS21127.pdf, emphasis added) In other words, everybody has just basically decided that insider trading is wrong and people should go to jail for doing it, and caselaw reflects that, but there's no actual statute in place anywhere.
        laken 8y ago
        One of the reasons that there is no particular statue for insider trading is that it's difficult to say who the person who insider trades harmed.
        adrr 8y ago
        The person on the other side of the trade. This would be the person who wrote the puts in this case and the entity harmed is more than likely the market maker for Equifax. If he just shorted the traditional way by borrowing and selling the stock, then its hard to argue who he harmed.
        rhizome 8y ago
        Plus the other stockholders
        wahern 8y ago
        There are plenty of victimless crimes on the statute books. The dispute over who might be theoretically harmed by insider trading relates to the legal theories proposed by courts and the SEC to justify the prohibition. Who might be harmed is of particular concern, particularly in the criminal domain, because we're dealing with an agency-created rule, and the courts are more-or-less following common law methodologies for specifying and circumscribing the rule. The applicable common law domain is Torts, and in Tort law there needs to be a breach of a duty to someone. Only once you identify that person (or persons) can you understand the scope of the duty owed them and by whom. The two competing theories are (1) that insider trading violates a fiduciary duty to the company from which the information came or (2) that insider trading violates a duty to the public at large, the so-called Fraud on the Market theory. The Fraud on the Market theory is what the SEC still clings to, but courts won't buy it because it's just too broad and doesn't really comport with established common law principles. An important self-constraint to fashioning non-statutory law is limiting oneself to extending pre-existing legal principles. The legislature isn't constrained by arcane legal technicalities. Their only constraint is the Constitution, which doesn't necessarily require shoe-horning laws into theoretically consistent buckets. The Fraud on the Market theory is too distant from any pre-existing legal principle, too distant from the plaintext of the existing statutes[1], and so only the legislature should be allowed to explicitly promulgate such a rule. [1] This is why we're talking about common law principles and not more recent administrative law principles. These days courts probably would never have allowed an administrative agency to invent something like insider trading, particularly as a crime, and so wouldn't have needed to make recourse to foundational common law principles. The courts accepted the prohibition prior to the modern development of administrative law.
    - JumpCrisscross 8y ago
      > Isn't the settlement with SEC to avoid the criminal record? No. The SEC is a civil agency which brings civil actions. Settling with the SEC does not prohibit the DoJ, or any state enforcement agency, from bringing criminal charges.
      - donald123 8y ago
        OK, make sense, just found out on the SEC website. So there won't be a criminal record before DOJ or local AGs place charges.
    - pm90 8y ago
      Additionally, SEC can't bring criminal charges. That has to be done via the FBI.
    - tawy1031 8y ago
      The SEC stuff was a civil action. They are being charged criminally by the state. From the article: > In a parallel proceeding, the U.S. Attorney’s Office for the Northern District of Georgia filed criminal charges against Bonthu.
  - frisco 8y ago
    A "permanent injunction" just means "I promise not to do it again and will get in more trouble next time if I do," not that he can't be paid in options in the future.
    - pille 8y ago
      Right, but I guess technically if he exercises the options, he’d own stock he could never sell? I know options are usually just cleared and pay out the difference if they’re in the money, but I don’t know if that’s how it’s seen legally.
- philip1209 8y ago
  Didn't Elizabeth Holmes make a similar civil settlement with the SEC before a different branch filed criminal charges?
- matt4077 8y ago
  This was a borderline case, because he didn't actually know definitely that they had had a breach. He only speculated based on being assigned a planning task for such a scenario. This settlement reflects the uncertainty of legal proceeding.
- saas_co_de 8y ago
  More BS law enforcement theater from the SEC. > Bonthu sold the put options and netted more than $75,000 WOW. 75K. Big fish there. > According to the complaint, Bonthu was told the work was being done for an unnamed potential client, but based on information he received, he concluded that Equifax itself was the victim of the breach. And the guy wasn't actually trading any insider info. He had info available to the general public and was smart enough to figure out the trade. Just like anyone else on wall street.
donald123 8y ago
Would be hard to discover if he uses his wife or relative's accounts to trade, right?
- posixplz 8y ago
  Not at all. Friends and families cannot trade on material non-public information. The SEC takes these investigations very seriously and they tend not to miss friend/family tipping.
  - baseethrowaway 8y ago
    How do they know who's friends with whom?
    - JumpCrisscross 8y ago
      > How do they know who's friends with whom? After any corporate action, the SEC (and various other agencies) trace back through trade records to look for suspicious trades. Family members are a matter of public record. And friends are now announced on LinkedIn, Twitter, Facebook, et cetera.
    - posixplz 8y ago
      Facebook, for one. While the SEC can undertake the tedious process of clearing all individuals with knowledge of the breach, a more effective tactic would be to look at suspicious trades and investigate potential insider knowledge. In that method, SEC looks at unusual volume/patterns in options contracts and security sales. The SEC will comb through each suspicious security sale that occurred prior to the breach announcement and cross reference the account owner's information with their list of insiders. If they have reasonable suspicion that a crime occurred, investigators obtain a warrant and complete the picture with phone records, email accounts, Facebook info (if not already obtained via parallel construction), etc.
      - gist 8y ago
        > Facebook, for one. So let's say in theory you could add a great deal of people as friends (thousands even) and in that case it would be quite difficult for the FBI to run that down (as they say). Besides they would have to supoena records from Facebook at a certain point if the 'friend' was not someone they could easily determine just from a picture or limited contact info. And don't even get into 'linkedin' that is filled with more people you don't really know or care about than any service. Most likely they will just work the other way. Someone makes a trade and they then see if they are linked to anyone in anyway at the company.
desireco42 8y ago
Of all the people to end in jail, this minor guy is the one? He clearly is not some major criminal but small opportunist.
- 21 8y ago
  Getting hacked, even if you were negligent, is not yet really a crime. Insider trading is.
  - paulie_a 8y ago
    It should be.
- jryan49 8y ago
  I think it makes sense. The minor guy doesn't know how to avoid getting in trouble like the bigger guys probably do.
- rhizome 8y ago
  Google a thing called "Fallacy of relative privation." Large crimes do not excuse smaller ones.
  - wuliwong 8y ago
    I don't think that is what OP was saying at all.
  - ModernMech 8y ago
    Funny though, small crimes always seem to be used to distract and deflect from the fact that no on ever gets punished for the large ones.
  - tawy1031 8y ago
    I believe the GP is making reference to the Equifax executive that sold a lot of stock right before the announcement of the data breach.
iaw 8y ago
I would like to see sentencing (probationary or prison) for financial crimes correspond to the amount of time it would take the median American to earn the amount of illicit proceeds. So if someone makes $5M illegally their penalty would be 5x greater than that of someone that made $1M illegally and both would vary in proportion to how many years of someone's life that represents.
- trjordan 8y ago
  I disagree with the notion that the penalty for white-collar crime should be strictly proportional to how good you are at that brand of crime. In a world where people occasionally steal $100m, that implies a maximum sentence of ~1 year for stealing $1m.
  - munk-a 8y ago
    I think you missed a big chunk of the OP's comment, if an average wage in the US is 60k then stealing 1m would be a sentence of 16 years 100m would be a 1600 year sentence by following the logic. It would be nice from the perspective of reducing the incomprehensibility from white collar crimes that net hundreds of millions of dollars though I'd be concerned about false charges... well, I'm generally concerned about false charges so we just need to fix our justice system, then such a scaling might make good sense. Just to briefly note, these crimes aren't victimless, people who pull these sorts of stunts are taking money out of someone's pocket, usually fraudulent stock maneuvers will end up negatively impacting retirement mutual funds, sometimes other white-collar crimes may be more impactful, prematurely issuing foreclosures deprives people of their household. In the former case the damage is spread around and less horrific feeling, but both are terrible.
- idoh 8y ago
  There are many reasons for punishment, like retribution, deterrence, and rehabilitation. Your proposal sorta makes sense on the retribution angle, but is grossly excessive for rehabilitation and deterrence. On the deterrence side, once someone has racked up, say, 50 years, there is no reason to stop because they will not really get punished further.
_bxg1 8y ago
This feels like a sacrificial lamb, to distract from the upper-level executives who made orders of magnitude more.
orbitingpluto 8y ago
I'm flabbergasted by how miniscule his investment was. 3500% return on $2k. Did he think it was too small to fly under the radar? Or is he small enough to prosecute?
- orbitingpluto 8y ago
  Ugh. Me talk bad. You know what meant.
adreamingsoul 8y ago
This sounds like he was thrown under the bus, probably to distract the SEC from investigating the executives who allowed corrupt business practices to continue.
paul7986 8y ago
Who cares about this one lone guy and his punishment? Why is Equifax still around.. we have no say or opt in system to allow them to use our personal data for their financial gain. I didnt agree to this! Isn't there an Equifax competitor that lets you opt in and is all about security. If not one of their competitors needs to rebrand as such or such a competitor needs to enter the market and whoop their a#*!
- guntars 8y ago
  That is assuming the market cares about opting in and security. Since their customer is a business that needs information on you and not you directly, I'd say it doesn't. The pressure to change will need to come from elsewhere.
- aerotwelve 8y ago
  Unfortunately, there's no business justification for any of them to do this. That is, the financial incentives just don't exist. Until we decide we've had enough of this and pass a real law that holds CRAs liable for the data they collect and store, absolutely nothing will change. Equifax's competitors know that, with no such law on the books, they have enough money to withstand the very few lawsuits that could come their way as a result of a breach. They know the average person doesn't have the spare cash or time to pursue such a case. Equifax should have been liquidated after demonstrating the degree of negligence they tolerated for years. They're still standing because we let them.
  - ModernMech 8y ago
    > Until we decide we've had enough of this and pass a real law that holds CRAs liable for the data they collect and store, absolutely nothing will change. Correct. This is a problem caused by the market. Expecting market forces (a competitor with better offerings) to just fix it isn't productive.
    - conanbatt 8y ago
      Its not a free market if you cant opt-out of it.
walrus01 8y ago
This low level guy gets punished, but the C level executives who let the system get so shoddy it resulted in the massive breach, they get nothing but a slap on their wrists.
digitaltrees 8y ago
I haven’t looked in a while so please correct me if I am wrong. But wasn’t there a report that the CTO did the same thing but was cleared? This seems like a much lower level manager.
- g051051 8y ago
  The global CIO resigned, but was never investigated or charged that I'm aware of. The CIO of the U.S. business unit was tapped to be the new global CIO, but he was fired for alleged insider trading, and then charged by the SEC.
NoPicklez 8y ago
How is it that one guy can be punished for insider trading, yet the executives responsible for exposing the business to one of the largest data breaches in history get off with just a slap on the wrist. Ignorance or negligence behavior when it comes to implementing and maintaining cyber security controls over PPI is not good enough, and the culture needs to change.
- Maarten88 8y ago
  I think the implicit cultural rule is, you can exploit anyone who stands lower on the society ladder, but you cannot cut into the profits of people more powerful. Thus insider trading is punished, breaching millions sensitive consumer records is not. This is probably not going to change anytime soon, it goes much deeper than maintaining security.
deltateam 8y ago
> Bonthu sold the put options and netted more than $75,000, a return of more than 3,500 percent on his initial investment. who doesn't love options am I right? any other delta or gamma chasers here

247 points by moonka 8y ago

jfim 8y ago

> To settle the SEC’s civil charges, Bonthu has agreed to a permanent injunction and to return his allegedly ill-gotten gains plus interest. It doesn't seem very dissuasive to only have to return the ill-gotten gains for insider trading, as it makes the returns of such trading positive if not all insider traders are caught.

JumpCrisscross 8y ago
"In a parallel proceeding, the U.S. Attorney’s Office for the Northern District of Georgia filed criminal charges against Bonthu" [1]. [1] this press release
posixplz 8y ago
A permanent injunction is a pretty big deal. I didn't want to spend the time finding the actual court filing corresponding to this press release, but 99% of the time, a "permanent injunction" in this context means a lifetime ban from the sale or offering of securities. Not such a big deal for the average Joe Sixpack, but in tech, where we're often paid in RSUs, options, and grants, it's a huge deal. Plus, there's the felony criminal record that will dissuade employers that aren't publicly traded.
- donald123 8y ago
  Isn't the settlement with SEC to avoid the criminal record? Besides it's supposed to be a civil charge by SEC.
  - posixplz 8y ago
    You're right, my mistake. Insider trading can be charged criminally. To be precisely correct on this case, we'd need to read the plea filing. The defendant's name is also public record, so while a criminal record search may not ding him, a regular search engine query sure will. :)
    - 783629gasd 8y ago
      Yes insider trading can be charged criminally, but there's no actual statute prohibiting it, surprisingly: "For example, Section 16 of the Securities Exchange Act of 1934 requires the disgorgement of short-swing profits by named insiders—directors, officers, and 10% shareholders. The 1934 Act’s general antifraud provision, Section 10(b), is frequently used in the prosecution of insider traders. Although the statute does not specifically mention insider trading but, instead, forbids the use of “manipulative or deceptive” means in buying or selling securities, case law has made clear that insider trading is the type of fraud that is prohibited by Section 10(b)" (https://fas.org/sgp/crs/misc/RS21127.pdf https://fas.org/sgp/crs/misc/RS21127.pdf, emphasis added) In other words, everybody has just basically decided that insider trading is wrong and people should go to jail for doing it, and caselaw reflects that, but there's no actual statute in place anywhere.
      - laken 8y ago
        One of the reasons that there is no particular statue for insider trading is that it's difficult to say who the person who insider trades harmed.
        adrr 8y ago
        The person on the other side of the trade. This would be the person who wrote the puts in this case and the entity harmed is more than likely the market maker for Equifax. If he just shorted the traditional way by borrowing and selling the stock, then its hard to argue who he harmed.
        rhizome 8y ago
        Plus the other stockholders
        wahern 8y ago
        There are plenty of victimless crimes on the statute books. The dispute over who might be theoretically harmed by insider trading relates to the legal theories proposed by courts and the SEC to justify the prohibition. Who might be harmed is of particular concern, particularly in the criminal domain, because we're dealing with an agency-created rule, and the courts are more-or-less following common law methodologies for specifying and circumscribing the rule. The applicable common law domain is Torts, and in Tort law there needs to be a breach of a duty to someone. Only once you identify that person (or persons) can you understand the scope of the duty owed them and by whom. The two competing theories are (1) that insider trading violates a fiduciary duty to the company from which the information came or (2) that insider trading violates a duty to the public at large, the so-called Fraud on the Market theory. The Fraud on the Market theory is what the SEC still clings to, but courts won't buy it because it's just too broad and doesn't really comport with established common law principles. An important self-constraint to fashioning non-statutory law is limiting oneself to extending pre-existing legal principles. The legislature isn't constrained by arcane legal technicalities. Their only constraint is the Constitution, which doesn't necessarily require shoe-horning laws into theoretically consistent buckets. The Fraud on the Market theory is too distant from any pre-existing legal principle, too distant from the plaintext of the existing statutes[1], and so only the legislature should be allowed to explicitly promulgate such a rule. [1] This is why we're talking about common law principles and not more recent administrative law principles. These days courts probably would never have allowed an administrative agency to invent something like insider trading, particularly as a crime, and so wouldn't have needed to make recourse to foundational common law principles. The courts accepted the prohibition prior to the modern development of administrative law.
  - JumpCrisscross 8y ago
    > Isn't the settlement with SEC to avoid the criminal record? No. The SEC is a civil agency which brings civil actions. Settling with the SEC does not prohibit the DoJ, or any state enforcement agency, from bringing criminal charges.
    - donald123 8y ago
      OK, make sense, just found out on the SEC website. So there won't be a criminal record before DOJ or local AGs place charges.
  - pm90 8y ago
    Additionally, SEC can't bring criminal charges. That has to be done via the FBI.
  - tawy1031 8y ago
    The SEC stuff was a civil action. They are being charged criminally by the state. From the article: > In a parallel proceeding, the U.S. Attorney’s Office for the Northern District of Georgia filed criminal charges against Bonthu.
- frisco 8y ago
  A "permanent injunction" just means "I promise not to do it again and will get in more trouble next time if I do," not that he can't be paid in options in the future.
  - pille 8y ago
    Right, but I guess technically if he exercises the options, he’d own stock he could never sell? I know options are usually just cleared and pay out the difference if they’re in the money, but I don’t know if that’s how it’s seen legally.
philip1209 8y ago
Didn't Elizabeth Holmes make a similar civil settlement with the SEC before a different branch filed criminal charges?
matt4077 8y ago
This was a borderline case, because he didn't actually know definitely that they had had a breach. He only speculated based on being assigned a planning task for such a scenario. This settlement reflects the uncertainty of legal proceeding.
saas_co_de 8y ago
More BS law enforcement theater from the SEC. > Bonthu sold the put options and netted more than $75,000 WOW. 75K. Big fish there. > According to the complaint, Bonthu was told the work was being done for an unnamed potential client, but based on information he received, he concluded that Equifax itself was the victim of the breach. And the guy wasn't actually trading any insider info. He had info available to the general public and was smart enough to figure out the trade. Just like anyone else on wall street.

donald123 8y ago

Would be hard to discover if he uses his wife or relative's accounts to trade, right?

posixplz 8y ago
Not at all. Friends and families cannot trade on material non-public information. The SEC takes these investigations very seriously and they tend not to miss friend/family tipping.
- baseethrowaway 8y ago
  How do they know who's friends with whom?
  - JumpCrisscross 8y ago
    > How do they know who's friends with whom? After any corporate action, the SEC (and various other agencies) trace back through trade records to look for suspicious trades. Family members are a matter of public record. And friends are now announced on LinkedIn, Twitter, Facebook, et cetera.
  - posixplz 8y ago
    Facebook, for one. While the SEC can undertake the tedious process of clearing all individuals with knowledge of the breach, a more effective tactic would be to look at suspicious trades and investigate potential insider knowledge. In that method, SEC looks at unusual volume/patterns in options contracts and security sales. The SEC will comb through each suspicious security sale that occurred prior to the breach announcement and cross reference the account owner's information with their list of insiders. If they have reasonable suspicion that a crime occurred, investigators obtain a warrant and complete the picture with phone records, email accounts, Facebook info (if not already obtained via parallel construction), etc.
    - gist 8y ago
      > Facebook, for one. So let's say in theory you could add a great deal of people as friends (thousands even) and in that case it would be quite difficult for the FBI to run that down (as they say). Besides they would have to supoena records from Facebook at a certain point if the 'friend' was not someone they could easily determine just from a picture or limited contact info. And don't even get into 'linkedin' that is filled with more people you don't really know or care about than any service. Most likely they will just work the other way. Someone makes a trade and they then see if they are linked to anyone in anyway at the company.

desireco42 8y ago

Of all the people to end in jail, this minor guy is the one? He clearly is not some major criminal but small opportunist.

21 8y ago
Getting hacked, even if you were negligent, is not yet really a crime. Insider trading is.
- paulie_a 8y ago
  It should be.
jryan49 8y ago
I think it makes sense. The minor guy doesn't know how to avoid getting in trouble like the bigger guys probably do.
rhizome 8y ago
Google a thing called "Fallacy of relative privation." Large crimes do not excuse smaller ones.
- wuliwong 8y ago
  I don't think that is what OP was saying at all.
- ModernMech 8y ago
  Funny though, small crimes always seem to be used to distract and deflect from the fact that no on ever gets punished for the large ones.
- tawy1031 8y ago
  I believe the GP is making reference to the Equifax executive that sold a lot of stock right before the announcement of the data breach.

iaw 8y ago

I would like to see sentencing (probationary or prison) for financial crimes correspond to the amount of time it would take the median American to earn the amount of illicit proceeds. So if someone makes $5M illegally their penalty would be 5x greater than that of someone that made $1M illegally and both would vary in proportion to how many years of someone's life that represents.

trjordan 8y ago
I disagree with the notion that the penalty for white-collar crime should be strictly proportional to how good you are at that brand of crime. In a world where people occasionally steal $100m, that implies a maximum sentence of ~1 year for stealing $1m.
- munk-a 8y ago
  I think you missed a big chunk of the OP's comment, if an average wage in the US is 60k then stealing 1m would be a sentence of 16 years 100m would be a 1600 year sentence by following the logic. It would be nice from the perspective of reducing the incomprehensibility from white collar crimes that net hundreds of millions of dollars though I'd be concerned about false charges... well, I'm generally concerned about false charges so we just need to fix our justice system, then such a scaling might make good sense. Just to briefly note, these crimes aren't victimless, people who pull these sorts of stunts are taking money out of someone's pocket, usually fraudulent stock maneuvers will end up negatively impacting retirement mutual funds, sometimes other white-collar crimes may be more impactful, prematurely issuing foreclosures deprives people of their household. In the former case the damage is spread around and less horrific feeling, but both are terrible.
idoh 8y ago
There are many reasons for punishment, like retribution, deterrence, and rehabilitation. Your proposal sorta makes sense on the retribution angle, but is grossly excessive for rehabilitation and deterrence. On the deterrence side, once someone has racked up, say, 50 years, there is no reason to stop because they will not really get punished further.

_bxg1 8y ago

This feels like a sacrificial lamb, to distract from the upper-level executives who made orders of magnitude more.

orbitingpluto 8y ago

I'm flabbergasted by how miniscule his investment was. 3500% return on $2k. Did he think it was too small to fly under the radar? Or is he small enough to prosecute?

orbitingpluto 8y ago
Ugh. Me talk bad. You know what meant.

adreamingsoul 8y ago

This sounds like he was thrown under the bus, probably to distract the SEC from investigating the executives who allowed corrupt business practices to continue.

paul7986 8y ago

Who cares about this one lone guy and his punishment? Why is Equifax still around.. we have no say or opt in system to allow them to use our personal data for their financial gain. I didnt agree to this! Isn't there an Equifax competitor that lets you opt in and is all about security. If not one of their competitors needs to rebrand as such or such a competitor needs to enter the market and whoop their a#*!

guntars 8y ago
That is assuming the market cares about opting in and security. Since their customer is a business that needs information on you and not you directly, I'd say it doesn't. The pressure to change will need to come from elsewhere.
aerotwelve 8y ago
Unfortunately, there's no business justification for any of them to do this. That is, the financial incentives just don't exist. Until we decide we've had enough of this and pass a real law that holds CRAs liable for the data they collect and store, absolutely nothing will change. Equifax's competitors know that, with no such law on the books, they have enough money to withstand the very few lawsuits that could come their way as a result of a breach. They know the average person doesn't have the spare cash or time to pursue such a case. Equifax should have been liquidated after demonstrating the degree of negligence they tolerated for years. They're still standing because we let them.
- ModernMech 8y ago
  > Until we decide we've had enough of this and pass a real law that holds CRAs liable for the data they collect and store, absolutely nothing will change. Correct. This is a problem caused by the market. Expecting market forces (a competitor with better offerings) to just fix it isn't productive.
  - conanbatt 8y ago
    Its not a free market if you cant opt-out of it.

walrus01 8y ago

This low level guy gets punished, but the C level executives who let the system get so shoddy it resulted in the massive breach, they get nothing but a slap on their wrists.

digitaltrees 8y ago

I haven’t looked in a while so please correct me if I am wrong. But wasn’t there a report that the CTO did the same thing but was cleared? This seems like a much lower level manager.

g051051 8y ago
The global CIO resigned, but was never investigated or charged that I'm aware of. The CIO of the U.S. business unit was tapped to be the new global CIO, but he was fired for alleged insider trading, and then charged by the SEC.

NoPicklez 8y ago

How is it that one guy can be punished for insider trading, yet the executives responsible for exposing the business to one of the largest data breaches in history get off with just a slap on the wrist. Ignorance or negligence behavior when it comes to implementing and maintaining cyber security controls over PPI is not good enough, and the culture needs to change.

Maarten88 8y ago
I think the implicit cultural rule is, you can exploit anyone who stands lower on the society ladder, but you cannot cut into the profits of people more powerful. Thus insider trading is punished, breaching millions sensitive consumer records is not. This is probably not going to change anytime soon, it goes much deeper than maintaining security.

deltateam 8y ago

> Bonthu sold the put options and netted more than $75,000, a return of more than 3,500 percent on his initial investment. who doesn't love options am I right? any other delta or gamma chasers here