BUS 623 AMU Week 6 Securities Violations and Trade Securities Discussion


Background: Securities violations are the subject of review and enforcement of the Securities and Exchange Commission (SEC), a federal agency.  Two types of violations found in SEC cases are:  (1) spoofing, and (2) insider trading

  • Spoofing is a deceptive trading practice to manipulate the market where traders place fake orders to trick others into trading at either inflated or depressed prices, resulting in losses to the deceived purchasers and profits to the spoofing trader.  For further information on spoofing.
  • Insider trading is buying or selling on the basis of personal knowledge the trader has or acquires by benefit of a relationship not available or known to the general trading public. For further information on insider trading go to.

PROMPT: For this discussion, research further, either spoofing or insider trading SEC violations. Find and share  a case example no more than 5 years old in SEC cases (do NOT use the spoofing case already cited in the above press release) that illustrates the practice you have selected.  In your initial Discussion post cover the following in reporting the case:

  • Briefly explain spoofing or insider trading (whichever one you have chosen) and why it is illegal (e.g., effect on business, society);
  • What is the specific statute and/or regulation violated by this conduct?
  • Identify the SEC case you have selected and provide a link to the case;
  • Describe the violation illustrated by the case, e.g. Who are the parties? What did the violator(s) do that constituted spoofing or insider trading? Who was harmed by the violation?
  • What is the ethical framework you observe was followed by the violator(s) in committing the illegal conduct? (Explain.)
  • Explain how the case was resolved, e.g., What happened to the violator(s)? What were the penalties levied against the violator(s), if any?
  • Do you believe the result is a just resolution of the violation? Why or why not?
  • Share any other thoughts you have on this topic.

Locate SEC Cases.


Welcome to our discussion on stock market and securities, quite often people use the stock market as the most important or only indicator of our economy. However, it is only one indicator and frankly it is a highly volatile indicator that is based on perception as opposed to reality so it is not a reliable indicator.

The market is based in hope and fear, and it rises and falls based on perception of the future more so than actual real-world performance. If the people who own the stock believe that the economy will turn bad for a particular reason or certain economic numbers come out, they will begin to sell and that will drop the stock market even if the company is doing well. Their belief may be true, or it may just be an inaccurate perception yet either way they influence the market.

We think of this as capitalism and the free market way, but in reality there is no such thing as a free market anywhere on this planet. The black market is the closest thing we have but as the black market is illegal is a heavily regulated. And in fact no market could exist or work without proper regulations.

We should also understand that the wealthiest people in this country own the vast majority of the stock market. In fact these major players create rises and falls in the market simply by purchasing or selling large amounts of stocks. They knowingly manipulate the market, and I found it quite ludicrous when these major players got upset and shut down the trading of game stop because the public was doing what they do every single day and manipulating the price as the public got together and bought in blocks. This is something these trading houses on Wall Street have been doing since the beginning of the stock market manipulating the prices and getting wealthy, but they get upset when the people got together to do it themselves.

If this wasn’t bad enough we can also see that many of our institutions are basically legalized pyramid schemes. Both banking and insurance are examples of this, if every member of the bank tried to take their money out at the same time or every subscriber at an insurance company had a claim at the exact same time either company would be able to pay their customers what they legally owe or pay those claims. Although this is a legalized pyramid scheme it still is a pyramid scheme nonetheless. And the latest example is crypto currency.

With the banking industry they are normally federally insured so the risk is lessened, this is not true with insurance companies or crypto’s that can go bankrupt do we think we should better regulate and force these types of companies to ensure themselves so that the customers will not lose everything?


This week I would like to dive into insider trading for our discussion post for the week. Insider trading is a form of trading stocks with information that is not easily available to the public. What I mean by this is that if you knew someone at X industries and they told you that a big merger was about to happen and that you should by stock now then that would be illegal for insider trading. This is because you would be trading off of information that is not accessible to the public. The regulation that covers insider trading is SEC Rule 10b-5. The case that I have chose to look into for insider trading was a case between three employees of Twilio Inc. and their families vs the company. Essentially, what happened in this case is that the employees new how the company was doing with their revenue information before the companies first quarter revenue was released. They then discussed and used the accounts of family to buy up stocks before the information was released because they “new the price would go up”. This resulted in a net gain of $1million in insider profit and then criminal charges being brought on to the employees and their families from the SEC. It seems like the case is still pending so at this time there are no criminal charges against the employees. I believe that they will get executed to the fullest extent of the law because they capitalized on this company during the pandemic.

Link to case: https://www.sec.gov/news/press-release/2022-55

BUS 623 AMU Week 6 Securities Violations and Trade Securities Discussion

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BUS 623 AMU Week 6 Securities Violations and Trade Securities Discussion


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BUS 623 AMU Week 6 Securities Violations and Trade Securities Discussion