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The fair way to handle this is to disallow any buying OR selling of related stocks until the public announcement of the results of the investigation.
by letstryagain 13y ago
The fair way to handle this is to disallow any buying OR selling of related stocks until the public announcement of the results of the investigation.
- jpwright 13y agoBut then you have conflict of interest if you're asking SEC employees to investigate companies they hold stock in. The incentive would be to not investigate or impose milder penalties.
- 001sky 13y agoNo, put the stocks in a blind trust.
- rdl 13y agoThis would make joining SEC a very expensive career move for a lot of people, especially if they only planned to be there for a year or two, and were heavily into former employers or other specific stocks based on their experience in the stock market.
- SkyMarshal 13y agoThey have to assign their holdings to a 3rd party financial manager/fund/401k/IRA/etc and recuse themselves from any active management of their own portfolio. Not sure if this is an industry-wide requirement, but I had to do this when I worked for a small bond fund some years ago. Zero trading my own account allowed, and required to disclose all personal holdings and activity to the compliance officer who reported to General Counsel.
- deleted 13y ago[deleted]
- robzyb 13y agoThat doesn't solve the problem. Employees will still have a conflict of interest because they will still want their stock's value to remain.
- Oculus 13y agoCould you expand on this point? I'm under the assumption that employees wouldn't know the portfolio of the blind trust, hence the blind.
- aspensmonster 13y agoHow about... just not holding any stocks?
- IgorPartola 13y agoHmm. Given that in order to retire in the US you must invest in the stock market that would be a big requirement. Don't get me wrong, I am all for solving this problem, but simply not allowing the SEC employees to participate in the market would be a pretty good way to ruin their retirement. An alternative would be to instead provide pensions. I don't really see how that happening given the "no handouts at any cost" attitude of the majority party in the House.
- judk 13y agoIndex fund or blind trust, problem solved.
- nknighthb 13y agoUh, look up the thread. You're replying to a post predicated on someone else's rejection of blind trusts.
- bonestamp2 13y agoHow about a blind trust of index funds? Those blind trusts aren't always blind.
- smutticus 13y agoI would argue that the people regulating the stock market should not be allowed to own stocks or any other sector investment, like an ETF focused on the health care industry. THey should still be allowed to own index based investment vehicles like an SP500 ETF.
- einhverfr 13y agoA better way would be to publically list all investigations for which SEC employees have been required to sell shares. But then that might pose due process issues for the companies. Maybe all SEC employees should be required to have stocks in blind trusts while working there?