Wall Street: Lawmakers urge SEC to toughen insider trading rules
Democratic senators are asking the US Securities and Exchange Commission to review rules for 10b5-1 plans, which allow executives to buy and sell company stock on predetermined days.Lawmakers are asking Wall Street’s top cop to review rules meant to prevent insider trading after new research suggested existing regulations may actually help some people trade on material, non-public information. Democratic Senators Elizabeth Warren, Sherrod Brown and Chris Van Hollen sent a letter to the Securities & Exchange Commission asking it to review rules for so-called 10b5-1 plans, which allow corporate executives to buy and sell company stock at predetermined days in the future. “These plans were designed to prevent insider trading, but new evidence indicates that executives — especially those in the health-care industry — are abusing these plans to obtain huge windfalls at the expense of ordinary investors,” the senators wrote in a letter dated Feb. 10 to acting SEC Chair Allison Lee.
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