SEC Charges Former Houston-Based CEO of Insider Trading in Stocks of Clients (with Lofchie Comment)

The SEC charged the former CEO of a Houston-based investor-relations firm with insider trading in the securities of multiple clients.

Lofchie Comment:Public companies should consider whether it is feasible to institute trading compliance procedures as to corporate service providers (other than investment banks) that obtain access to inside information. I say "other than investment banks" because investment banks already implement such procedures as to their employees, and it is unlikely that there is anything that the corporate issuer could do to supplement that. But other types of firms, such as public-relations firms, may not have such compliance procedures in place.

See: SEC Litigation Release.