Name: 0618Trading-TIME2
Uploaded: 2014-06-18
Duration: 1 min 46 s
Description: 0618Trading-TIME2

A newly released study on Wall Street insider trading has produced damning results that may surprise even the most cynical of investors. The study conducted by New York University and McGill University found that a quarter of merges and acquisitions deals from 1996 to 2012 involves some insider trading. Average profit from those deals? More than $ 1. 6 million. I can confirm that we at the United States Department of Justice are investigating this practice. And while the SEC and Department of Justice have said they want prosecuting insider training to be a priority. The study also found the securities and exchange commission litigated less than 5 % of the 1859 mergers and acquisition deals the study sampled. It also took them more than two years to do so, on average. They spend their time looking at the biggest transactions and the biggest players, and to some degree you could argue looking for the biggest headlines to the extent that they can deter this activity. But even when the SCC reels in a big fish. You haven't seen a corporate take down like this since the 1980s. Like billionaire, Steven Cohen and SAC Capital which pleaded guilty to insider trading last November. Some argue that it's not nearly enough to stop the practice. It's hard to see how these trophy targets will do much to stem the flow of suspect information to those lucky enough to be in earshot of the tips. Researchers didn't rule out the possibility of traders simply getting lucky, but the numbers did. According to the study, trades found to be suspicious were so well timed. The probability of the unusual volume in the sample arising out of chance is about three in a trillion. Thanks for watching, I'm Jamal Andrews.