Case Study #1: Chugach Dreams
A week before YYYY, Inc's acquisition of XXXXXX, Inc. was announced, the girlfriend of a Minnesota man opened a brokerage account at XYZ Securities and immediately bought short dated call options in XXXXXX, Inc. It was later discovered the Minnesota man was acting on a tip from another individual who he met on a skiing forum. After review, the man was required to disgorge the entire $37 dollars profit from the trade and required to pay $25,000 in fines. In exchange for the girlfriends testimony, all charges were rescinded against her and as a SAR was filed at the time of the trade, the RR at XYZ Securities was found in compliance with company rules and not fined.
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