Insider trading
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| + | '''Insider trading''' is the trading of a [[public company]]'s [[stock]] or other [[security (finance)|securities]] (such as [[bond (finance)|bonds]] or [[Option (finance)|stock options]]) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal. This is because it is seen as unfair to other investors who do not have access to the information, as the investor with insider information could potentially make larger profits than a typical investor could make. The rules governing insider trading are complex and vary significantly from country to country. The extent of enforcement also varies from one country to another. The definition of insider in one jurisdiction can be broad, and may cover not only insiders themselves but also any persons related to them, such as brokers, associates, and even family members. A person who becomes aware of [[market moving information|non-public information]] and trades on that basis may be guilty of a crime. | ||
| - | '''''Phone Booth''''' is a 2002 American [[Thriller (genre)|thriller film]] directed by [[Joel Schumacher]], produced by [[David Zucker (filmmaker)|David Zucker]] and Gil Netter, written by [[Larry Cohen]] and starring [[Colin Farrell]], [[Forest Whitaker]], [[Katie Holmes]], [[Radha Mitchell]] and [[Kiefer Sutherland]]. In the film, a young publicist named Stuart Shepard is being put in a conflict against a mysterious [[sniper]], who calls him in a [[phone booth]], in which Stu shortly answers the phone itself and becomes pulled into danger. The film received generally positive reviews from film critics and was a [[box office]] hit, grossing $97 million worldwide, against a production budget of $13 million. Critics praised Farrell's performance and composer [[Harry Gregson-Williams]]' score. | + | Trading by specific insiders, such as employees, is commonly permitted as long as it does not rely on material information not in the [[public domain]]. Many jurisdictions require that such trading be reported so that the transactions can be monitored. In the United States and several other jurisdictions, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases, insiders in the United States are required to file a [[Form 4]] with the U.S. [[Securities and Exchange Commission]] (SEC) when buying or selling shares of their own companies. The authors of one study claim that illegal insider trading raises the cost of capital for securities issuers, thus decreasing overall economic growth. |
| + | ==See also== | ||
| - | ==Plot== | + | * [[Abuse of information]] |
| - | Stuart "Stu" Shepard ([[Colin Farrell]]) is an arrogant [[New York City]] publicist who has been courting a woman named Pam ([[Katie Holmes]]) behind his wife Kelly ([[Radha Mitchell]]). He uses the last remaining public phone booth in the city to contact Pam. During the call, he is interrupted by a [[pizza delivery]] man, who attempts to deliver a free pizza to him, but Stu rudely turns him away by insulting his weight. As soon as Stu completes his call to Pam, the phone rings. Stu answers, to find that The Caller, who knows his name, warns him not to leave the booth, and says he will say hello to Pam for him. He also says he will call Kelly, leaving Stu panicked. | + | * [[Big boy letter]] |
| - | + | * [[Efficient-market hypothesis]] | |
| - | The caller tells Stu that he has tested two previous individuals who have done wrong deeds in a similar manner (one was a [[pedophile]], the other was a [[insider trading|company insider]] who cashed out his stock options before the share price collapsed), giving each a chance to reveal the truth to those they wronged, but in both cases, neither agreed and were killed. To demonstrate the threat, the caller fires a suppressed sniper rifle at a toy robot sold by a nearby vendor; the damage is unseen by anyone but Stu, the caller, and the vendor. The caller demands that Stu confess his feelings for Pam to both Kelly and Pam to avoid being killed. The caller contacts Pam, and puts her on line with Stu, who reveals that he is married. The caller then hangs up, telling Stu to call Kelly himself. | + | * [[Federal Bureau of Investigation]] (FBI) |
| - | + | * [[ImClone stock trading case]] | |
| - | As Stu hesitates, the booth is approached by three prostitutes demanding to use the phone. Stu refuses to leave, having been warned by the caller to stay in the booth and not reveal the situation. Leon ([[John Enos III]]), the prostitutes' pimp, joins his charges, smashes the side of the booth, grabs at Stu in a headlock and starts punching him. The caller offers to "make him stop" and asks if Stu can hear him, which Stu just answers positively, causing the caller to misunderstand Stu and shoot Leon. Leon staggers away before collapsing dead in the street. The prostitutes immediately blame Stu, making a scene over Leon's body, accusing him of having a gun as the police and news crews converge on the location. | + | * [[Mathew Martoma]] |
| - | + | * [[Operation Perfect Hedge]] | |
| - | Police Captain Ed Ramey ([[Forest Whitaker]]), already suspecting Stu of being the killer, seals off the streets with police roadblocks and starts trying to negotiate to get him to leave the booth, but Stu refuses, telling the caller that there is no way they can incriminate him; the caller proves him wrong, calling his attention to a handgun that was planted in the roof of the phone booth. Both Kelly and Pam soon arrive on the scene. The caller demands that Stu tell Kelly the truth, which he does. The caller then orders Stu to choose between Kelly and Pam, and the woman he does not choose will be killed. | + | * [[Private Securities Litigation Reform Act]] |
| - | + | * [[Raj Rajaratnam/Galleon Group, Anil Kumar, and Rajat Gupta insider trading cases]] | |
| - | While on the phone with the caller, Stu secretly uses his cell phone to call Kelly, allowing her to overhear his conversation with the caller. She, in turn, quietly informs Captain Ramey of this. Meanwhile, Stu continues to confess to everyone that his whole life is a lie, to make himself look more important than he really is or even feels. Stu's confession provides sufficient distraction to allow the police to trace the payphone call to a nearby building, and Ramey uses coded messages to inform Stu of this. Stu warns the caller that the police are on the way, and the caller replies that if he is caught, then he will kill Kelly. Panicked, Stu grabs the handgun and leaves the booth, screaming for the sniper to kill him instead of Kelly. The police fire upon Stu, while a smaller force breaks into the room that the caller was tracked to, only to find the gun and a man's corpse. | + | * [[Reebok insider trading case]] |
| - | + | * [[Securities fraud]] | |
| - | Stu regains consciousness to find the police fired only [[rubber bullet]]s at him, stunning but not harming him. Stu and Kelly happily reunite. As the police bring down the body, Stu identifies it as the pizza delivery man from earlier. Stu gets medical treatment at a local ambulance; as he does, a man with a briefcase ([[Kiefer Sutherland]]) passes by and says that he regrets killing the pizza deliverer and warns Stu that if his new-found honesty does not last, he will be hearing from him again. The man disappears into the crowd with Stu unable to call out due to being sedated by the paramedics. As he does, someone else is being called from that same line. The audience could only hear him say, "Hello?" and the film ends. | + | * [[Securities regulation in the United States]] |
| - | + | * [[Selective disclosure]] | |
| - | ==Cast== | + | * ''[[Tip and Trade]]'': How Two Lawyers Made Millions From Insider Trading |
| - | * [[Colin Farrell]] as Stuart "Stu" Shepard, A young arrogant publicist who becomes a victim of a mysterious caller inside a phone booth who threatens to harm him. | + | |
| - | * [[Kiefer Sutherland]] as The Caller, An unnamed, mysterious, but skilled [[sniper]] and killer, who calls Stu in the phone booth, and starts to threaten his life. | + | |
| - | * [[Forest Whitaker]] as Capt. Ed Ramey, A police captain whose giving assistance for Stu in his conflict against The Caller but suspected him as the killer. | + | |
| - | * [[Katie Holmes]] as Pamela McFadden | + | |
| - | * [[Radha Mitchell]] as Kelly Shepard, Stu's wife. | + | |
| - | * [[Paula Jai Parker]] as Felicia | + | |
| - | * Arian Ash as Corky | + | |
| - | * [[Tia Texada]] as Asia | + | |
| - | * [[John Enos III]] as Leon | + | |
| - | * [[Richard T. Jones]] as Sgt. Jonah Cole | + | |
| - | * [[Keith Nobbs]] as Adam | + | |
| - | * [[Dell Yount]] as Bobby (uncredited) | + | |
| - | + | ||
| - | ===Box office=== | + | |
| - | The film grossed $46,566,212 in the United States and $51,270,925 internationally for a total gross of $97,837,138, above its $13 million production budget. | + | |
| - | + | ||
| - | ==See also== | + | |
| - | * ''[[Liberty Stands Still]]'' (also a 2002 film), starring [[Wesley Snipes]] and [[Linda Fiorentino]], that shares similar plot and theme | + | |
| - | * [[Knock Out (2010 film)|''Knock Out'' (2010 film)]], an unauthorized Bollywood remake of ''Phone Booth'' | + | |
| - | * [[Locke (film)|''Locke'' (2013 film)]] | + | |
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Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal. This is because it is seen as unfair to other investors who do not have access to the information, as the investor with insider information could potentially make larger profits than a typical investor could make. The rules governing insider trading are complex and vary significantly from country to country. The extent of enforcement also varies from one country to another. The definition of insider in one jurisdiction can be broad, and may cover not only insiders themselves but also any persons related to them, such as brokers, associates, and even family members. A person who becomes aware of non-public information and trades on that basis may be guilty of a crime.
Trading by specific insiders, such as employees, is commonly permitted as long as it does not rely on material information not in the public domain. Many jurisdictions require that such trading be reported so that the transactions can be monitored. In the United States and several other jurisdictions, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases, insiders in the United States are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies. The authors of one study claim that illegal insider trading raises the cost of capital for securities issuers, thus decreasing overall economic growth.
[edit]
See also
- Abuse of information
- Big boy letter
- Efficient-market hypothesis
- Federal Bureau of Investigation (FBI)
- ImClone stock trading case
- Mathew Martoma
- Operation Perfect Hedge
- Private Securities Litigation Reform Act
- Raj Rajaratnam/Galleon Group, Anil Kumar, and Rajat Gupta insider trading cases
- Reebok insider trading case
- Securities fraud
- Securities regulation in the United States
- Selective disclosure
- Tip and Trade: How Two Lawyers Made Millions From Insider Trading
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