Insider trading PR guru
I’ll be interested to see what sentence gets handed down in the case of a PR consultant who pleaded guilty to three charges of insider trading.
Margot Olive McKay was the principal of a firm that worked for Aristocrat Leisure. She bought $148,000 of Aristocrat shares through relatives after proof reading positive company reports and sold later for a profit of about $70,000.
The crime seems to be at the lower end of the scale and there are mitigating factors. Also, I’ve seen the market react adversely to positive announcements, so McKay could not have been certain of a commercial gain.
It made me think though about my own consulting experience and whether I ever came across information that was potentially market sensitive.
At least one occasion comes to mind from when I was working for Pauls. They were negotiating a deal with a small boutique dairy brand and I authored a draft media release. The talks fell through and the media release was never issued.
If I had bought shares in the small listed company, in anticipation of the deal, I would have been guilty of insider trading even though I had no idea how the market would respond. I was aware of this at the time.
I handled a number of commercially sensitive issues for Pauls, who are not listed on the Australian Stock Exchange. Fortunately I was never tempted to buy shares offshore in the Italian parent company Parmalat, which collapsed amid the rubble of a corporate fraud disaster.
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