5 ms·

How do they prove this? A lot of people play earnings. Amazon is not an obscure stock. In fact, making an earnings play on Amazon is probably one of the more re

How do they prove this? A lot of people play earnings. Amazon is not an obscure stock. In fact, making an earnings play on Amazon is probably one of the more reasonable safer things to do compared to what the world is up to now days.

ApolloRising 5y ago
Hard to guess right 11 times in a row.
- runawaybottle 5y ago
  But here’s the thing, Amazon is the type of company that most likely beat earnings for an entire decade. It’s not hard to guess at all. Edit: blah, nevermind: https://techcrunch.com/2019/10/24/after-its-first-earnings-miss-in-two-years-amazon-shares-get-walloped-in-after-hours-trading/amp/ https://techcrunch.com/2019/10/24/after-its-first-earnings-m... I guess if he dodged those earnings plays, that would build a good case.
  - ne0flex 5y ago
    I remember when I first started trading stocks, I bought Amazon after Christmas 2013 or 2014 in anticipation that their earnings would kill it due to Christmas. I think Amazon was at around $400 at the time. After the earnings report, they dropped about $320 so I freaked out, sold and never touched Amazon again. I still cry to this day.
- LanceH 5y ago
  He needed Clinton's lawyer.
  - brewdad 5y ago
    Instead of Martha Stewart's?
    - LanceH 5y ago
      For all the conspiracy about Hilary, I believe her commodity trading stands out as confirmed. She traded for 10 months, making 100x and then stopped for some reason -- I guess they didn't like making money.
toddmatthews 5y ago
his wife would have been in a black out period where she's not allowed to be trading Amazon stock if she works there. i'm not sure if the blackouts specifically applies to the husband, but him doing this 11 times right before an earning call? its kinda blatant edit: Blackouts include the employee and all family members. You can not trade during blackout periods.
reverend_gonzo 5y ago
If you only do it for one stock, do it for every earnings, and have a win rate of 100%, that becomes pretty obvious. Also, by the way, they were legally not allowed to trade during those times at all, due to her specific job and the blackout period that cme with.
- dnautics 5y ago
  Out of curiosity what was the outcome of each of these? Did Amazon drop on any of them? Hypothetically if they're all up, then it suddenly seems way less sketchy.
bin_bash 5y ago
He pleaded guilty so it doesn’t matter in this case
riffraff 5y ago
He and the wife pleaded guilty, so presumably they had enough proof. From the article it seems she had material access to finance data and was under obligation to not do trades so they would just need to prove he spoke with her about it.
pcurve 5y ago
Since they got a guilty plea out of him, I'm guessing they had strong enough proof to discourage him from going to trial where he could've risked up to 25 years in jail time if jury found the evidence credible. If he had just stuck with stocks, I'm sure it would've been harder to prove. But with options and dates, timing of it... it's hard to get away.
- dnautics 5y ago
  Earnings calls dates are announced ahead of time, so that doesn't factor in to it.
mrandish 5y ago
They look for accounts that make consistently "lucky" large trades during blackout periods before earnings but at or just after the close of the quarter. Then they run the SSN/address/bank accounts/phone # associated with the trading account and compare to lists of insiders supplied by companies of who has access to their financial info. I think they also have separate flags on insider's tax returns to look for any unusual capital gains from market transactions. It's not a trivial problem to make trades in an account completely unrelated to you and then get the illegit proceeds back into your control without tripping some flags. Also, most of the volume in these stocks are huge algorithmic trades from institutional investors and funds. They also tend to move in herds based on when analysts release new reports or change ratings on the stock. Thus, those are pretty easy to filter out of a search. Unusual trades from individual brokerage accounts are going to stand-out. Especially if those accounts aren't making similar trades in other stocks. When they get suspicious matches they run them down to see if there's anything there. I used to be an insider at a big tech company and there's quite a bit of scrutiny. You'd have to be really stupid to do that shit. Especially repeatedly with large amounts.
- crispyambulance 5y ago
  > When they [the SEC] get suspicious matches they run them down to see if there's anything there This is correct!
- mbg721 5y ago
  > They look for accounts that make consistently "lucky" large trades Sounds like how casinos ban card-counters.
brewdad 5y ago
Well for starters, his wife was forbidden to trade AMZN during the dates in question. When they find an account owned by her spouse, and possibly jointly, doing such trades it's not hard to figure it out. Also, had he done this once or twice, they might not have found it but 11 quarters in a row is going to get noticed eventually.

ApolloRising 5y ago

Hard to guess right 11 times in a row.

runawaybottle 5y ago
But here’s the thing, Amazon is the type of company that most likely beat earnings for an entire decade. It’s not hard to guess at all. Edit: blah, nevermind: https://techcrunch.com/2019/10/24/after-its-first-earnings-miss-in-two-years-amazon-shares-get-walloped-in-after-hours-trading/amp/ https://techcrunch.com/2019/10/24/after-its-first-earnings-m... I guess if he dodged those earnings plays, that would build a good case.
- ne0flex 5y ago
  I remember when I first started trading stocks, I bought Amazon after Christmas 2013 or 2014 in anticipation that their earnings would kill it due to Christmas. I think Amazon was at around $400 at the time. After the earnings report, they dropped about $320 so I freaked out, sold and never touched Amazon again. I still cry to this day.
LanceH 5y ago
He needed Clinton's lawyer.
- brewdad 5y ago
  Instead of Martha Stewart's?
  - LanceH 5y ago
    For all the conspiracy about Hilary, I believe her commodity trading stands out as confirmed. She traded for 10 months, making 100x and then stopped for some reason -- I guess they didn't like making money.

toddmatthews 5y ago

his wife would have been in a black out period where she's not allowed to be trading Amazon stock if she works there. i'm not sure if the blackouts specifically applies to the husband, but him doing this 11 times right before an earning call? its kinda blatant edit: Blackouts include the employee and all family members. You can not trade during blackout periods.

reverend_gonzo 5y ago

If you only do it for one stock, do it for every earnings, and have a win rate of 100%, that becomes pretty obvious. Also, by the way, they were legally not allowed to trade during those times at all, due to her specific job and the blackout period that cme with.

dnautics 5y ago
Out of curiosity what was the outcome of each of these? Did Amazon drop on any of them? Hypothetically if they're all up, then it suddenly seems way less sketchy.

bin_bash 5y ago

He pleaded guilty so it doesn’t matter in this case

riffraff 5y ago

He and the wife pleaded guilty, so presumably they had enough proof. From the article it seems she had material access to finance data and was under obligation to not do trades so they would just need to prove he spoke with her about it.

pcurve 5y ago

Since they got a guilty plea out of him, I'm guessing they had strong enough proof to discourage him from going to trial where he could've risked up to 25 years in jail time if jury found the evidence credible. If he had just stuck with stocks, I'm sure it would've been harder to prove. But with options and dates, timing of it... it's hard to get away.

dnautics 5y ago
Earnings calls dates are announced ahead of time, so that doesn't factor in to it.

mrandish 5y ago

They look for accounts that make consistently "lucky" large trades during blackout periods before earnings but at or just after the close of the quarter. Then they run the SSN/address/bank accounts/phone # associated with the trading account and compare to lists of insiders supplied by companies of who has access to their financial info. I think they also have separate flags on insider's tax returns to look for any unusual capital gains from market transactions. It's not a trivial problem to make trades in an account completely unrelated to you and then get the illegit proceeds back into your control without tripping some flags. Also, most of the volume in these stocks are huge algorithmic trades from institutional investors and funds. They also tend to move in herds based on when analysts release new reports or change ratings on the stock. Thus, those are pretty easy to filter out of a search. Unusual trades from individual brokerage accounts are going to stand-out. Especially if those accounts aren't making similar trades in other stocks. When they get suspicious matches they run them down to see if there's anything there. I used to be an insider at a big tech company and there's quite a bit of scrutiny. You'd have to be really stupid to do that shit. Especially repeatedly with large amounts.

crispyambulance 5y ago
> When they [the SEC] get suspicious matches they run them down to see if there's anything there This is correct!
mbg721 5y ago
> They look for accounts that make consistently "lucky" large trades Sounds like how casinos ban card-counters.

brewdad 5y ago

Well for starters, his wife was forbidden to trade AMZN during the dates in question. When they find an account owned by her spouse, and possibly jointly, doing such trades it's not hard to figure it out. Also, had he done this once or twice, they might not have found it but 11 quarters in a row is going to get noticed eventually.