Martha Stewart apparently got an insider tip from her broker on a stock, involving a company with whom she was personal friends of the president. She apparently lied about what transpired before a Securities and Exchange Commission investigation. She, her broker, and the president of the other company all wound up spending time in jail.
- Is it ethical for a broker to dispense any insider information? To dispense it to favored clients, but not to his company? To disclose it to favored clients but not other clients?
- To what extent is it practical to require that the president/majority shareholder of a company and knows the company is not doing well will not sell his stock before this news becomes public?