But suppose instead, a thief, who does not work at Microsoft, breaks into Microsoft headquarters via a basement window at midnight, reads Microsoft’s CFO’s papers about an upcoming positive earnings announcement and then buys Microsoft stock before that announcement. Is the thief guilty of insider trading? Historically, the SEC did not charge the thief with insider trading because a thief is just that, a thief, and not an insider or securities swindler.
Today, however, the SEC staff is dramatically changing course. The SEC has now begun targeting the thief, because the break-in is no longer through a basement window, instead the break-in is through a virtual window, in cyberspace.
via The SEC’S “Outsider Trading” Dragnet — Cybersecurity Docket
