BP Posted November 17, 2008 Share Posted November 17, 2008 WASHINGTON -- Federal regulators have accused billionaire Dallas Mavericks owner Mark Cuban of insider trading for allegedly using confidential information on a stock sale to avoid more than $750,000 in losses. The Securities and Exchange Commission filed a civil lawsuit against Cuban on Monday in federal court in Dallas. The agency said that in June 2004, Cuban was invited to get in on the coming stock offering by Mamma.com Inc. after he agreed to keep the information private. The SEC said Cuban knew the shares of stock, put at 600,000, would be sold below the current market price, and a few hours after receiving the information, told his broker to sell all shares in the search engine company. The commission is seeking to impose financial penalties and confiscate gains from the trades. It is up to the U.S. Attorney in Dallas to determine whether Cuban should face criminal charges. "As we allege in the complaint, Mamma.com entrusted Mr. Cuban with nonpublic information after he promised to keep the information confidential. Less than four hours later, Mr. Cuban betrayed that trust by placing an order to sell all of his shares," Scott W. Friestad, deputy director of the SEC's Division of Enforcement, said in a statement. "It is fundamentally unfair for someone to use access to nonpublic information to improperly gain an edge on the market." In a statement posted on Cuban's blog, blogmaverick.com, attorney Ralph C. Ferrara said Cuban would challenge the suit. "This matter, which has been pending before the Commission for nearly two years, has no merit and is a product of gross abuse of prosecutorial discretion," Ferrara said. "Mr. Cuban intends to contest the allegations and to demonstrate that the Commission's claims are infected by the misconduct of the staff of its Enforcement Division." In the same statement, Cuban said, "I am disappointed that the Commission chose to bring this case based upon its Enforcement staff's win-at-any-cost ambitions. The staff's process was result-oriented, facts be damned. The government's claims are false and they will be proven to be so." According to the SEC, the complaint seeks to permanently enjoin Cuban from future violations of the federal securities laws, disgorgement (with prejudgment interest), and a financial penalty. "Insider trading cases are a high priority for the Commission," Linda Chatman Thomsen, director of the SEC's Division of Enforcement, said in the statement. "This case demonstrates yet again that the Commission will aggressively pursue illegal insider trading whenever it occurs." Cuban's situation is drawing comparisons to Martha Stewart's involvement in insider trading in 2001. Stewart was also charged with obstruction for lying to FBI investigators. She was convicted in March 2004 on charges of conspiracy, obstruction of justice, and two counts of making false statements and was sentenced to prison. Mamma.com, a Canadian company, merged with Copernic Technologies in December 2005. Copernic also offers search software and online advertising services. Mamma.com now trades under Copernic's ticker, CNIC. "We don't comment on matters such as these," said Brian McIntyre, NBA senior vice president of basketball communications. Information from The Associated Press was used in this report. Link Throw him in jail. Link to comment Share on other sites More sharing options...
NJ Posted November 17, 2008 Share Posted November 17, 2008 Yeah - so much for the Cubs getting a good owner. Link to comment Share on other sites More sharing options...
anskyruben Posted November 17, 2008 Share Posted November 17, 2008 Martha Stewart got sent to jail for less. He better fess up. Feds hate when people lie to them Link to comment Share on other sites More sharing options...
Thai Jet Posted November 17, 2008 Share Posted November 17, 2008 What's good enough for Martha Stewart is good enough for him. JAIL TIME !!! Link to comment Share on other sites More sharing options...
124 Posted November 17, 2008 Share Posted November 17, 2008 Blah. I don't get the big deal. His knowledge is somebody elses' loss, so what? He has the advantage, good for him. But whatever. Link to comment Share on other sites More sharing options...
Thai Jet Posted November 17, 2008 Share Posted November 17, 2008 Blah. I don't get the big deal. His knowledge is somebody elses' loss, so what? He has the advantage, good for him. But whatever. If you were old enough to be an investor in the stock market you'd feel totally different. Link to comment Share on other sites More sharing options...
124 Posted November 17, 2008 Share Posted November 17, 2008 If you were old enough to be an investor in the stock market you'd feel totally different. I have all that junk, except I don't run it. I'm not stupid. If I didn't have it run by someone else, I wouldn't have it. Its a waste of time. Its basically gambling. Link to comment Share on other sites More sharing options...
BP Posted November 17, 2008 Author Share Posted November 17, 2008 I have all that junk, except I don't run it. I'm not stupid. If I didn't have it run by someone else, I wouldn't have it. Its a waste of time. Its basically gambling. Link to comment Share on other sites More sharing options...
Thai Jet Posted November 18, 2008 Share Posted November 18, 2008 I have all that junk, except I don't run it. I'm not stupid. If I didn't have it run by someone else, I wouldn't have it. Its a waste of time. Its basically gambling. Link to comment Share on other sites More sharing options...
war ensemble Posted November 18, 2008 Share Posted November 18, 2008 I have all that junk, except I don't run it. I'm not stupid. If I didn't have it run by someone else, I wouldn't have it. Its a waste of time. Its basically gambling. Did your economics teacher fail you again? Link to comment Share on other sites More sharing options...
Thai Jet Posted November 18, 2008 Share Posted November 18, 2008 Did your economics teacher fail you again? Apparently Link to comment Share on other sites More sharing options...
Maxman Posted November 18, 2008 Share Posted November 18, 2008 Much like the interwebz this is serious business. Link to comment Share on other sites More sharing options...
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