Posted by Justin Gandhi.
In current news, a Russian billionaire investor has decided to confront Morgan Stanely in court, due to insider trading practices. Insider trading is the illegal practice of trading on the stock exchange to one’s own advantage through having access to confidential information. This is illegal and unethical.
The Russian billionaire claims that Morgan Stanely illegally sold a company based on information in the peak of the financial crisis. The claim is that Morgan Stanely obtained it information through the company’s lender. Morgan Stanely’s trader immediately began short-selling the stock before the company would have to liquidate its stock and default. Morgan Stanely made 4.6 million dollars apposed to losing 6.6 million from the illegal information received.
Morgan Stanley claims it was simply hedging against exposure to risk. This trial is still in process. Be on the look out to hear more about the open arguments, defenses, and the final decision.
Justin is a finance major at the Stillman School of Business, Seton Hall University, Class of 2017.