Matt Levine, Columnist

Is Insider Guessing Illegal?

Also bug-exploit shorting, CFIUS, Bear Stearns and bond market liquidity.

March 15, 2018 at 10:19 AM EDT

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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Equifax insider trading!

If you work at a public company, and it suffers a massive data breach, and you find out about it before it is public, and you sell your stock, is that illegal insider trading? I do not want to give you legal advice, and there are some nuances to the question, but the basic answer is, duh, yes. That data breach is probably material to the company's stock, and you are clearly an insider, and so if you find out about the breach and trade on it then you are breaking the law.

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