Good ethics question
- Thread starter deep2002
- Start date
It can not be B, the second half of the statements talks about trading without CEO acknowleding the sales forecast that would be acting on the a non-Public Material Information and amounts to Insider Trading, Also he doesn't have any other basis to go for trading.
C seems the apt choice since it is a conflict between previously secured information and the current assignment, where he can not act in unbiased way.
C seems the apt choice since it is a conflict between previously secured information and the current assignment, where he can not act in unbiased way.
Read B again. If he asks the CEO to give up the info and he doesn' by NOT trading the stock he would be acting on the inside infomation. So in this case, since the traders company was going to buy the stock without the inside information, the trader must place the trades.
He would effectively be action on inside info by not trading.
He would effectively be action on inside info by not trading.
- Thread starter
- #24
thats true mwvt9, but I would have gone with C...I never see anything wrong with asking the compliance department, and even the standards have it as one of the guidlines (to ask compliance when in doubt) so now if I see questions like this I am lost because there is a conflict between the standards and I would not know about going to compliance or "encouraging them to make it public"
Is there a fixed guideline about whether to go through compliance or
Is there a fixed guideline about whether to go through compliance or
There is no conflict. Why don;t you read C first instead of reading B first. When you are reading C, you are assuming that the CEO has denied that he will make the information public. The standards say that ONLY if he CEO has denied that he won't make the information public, should the person reveal it to the supervisor or the compliance officer.
C doesn't mention whether the CEO denied it or not. It just says that the member should divulge it to the supervisor etc. You are ASSUMING that the CEO denied (after reading choice B). You are doing it subconsciously and not realizing it. So read the Ques. again without reading Choice B and tell me if C is correct.
C doesn't mention whether the CEO denied it or not. It just says that the member should divulge it to the supervisor etc. You are ASSUMING that the CEO denied (after reading choice B). You are doing it subconsciously and not realizing it. So read the Ques. again without reading Choice B and tell me if C is correct.
- Thread starter
- #26
ruhi22 Wrote:
-------------------------------------------------------
> The standards
> say that ONLY if he CEO has denied that he won't
> make the information public, should the person
> reveal it to the supervisor or the compliance
> officer.
>
>
Ahh, ok thanks Ruhi it makes sense now - you should go to your compliance as a last resort only after you tried to encourage the information to become public... But after you try to encourage them and the CEO refuses, should you not go to the compliance department instead of trading on the stock? Because B says to not go to the compliance department but to just trade even if the CEO refuses.
-------------------------------------------------------
> The standards
> say that ONLY if he CEO has denied that he won't
> make the information public, should the person
> reveal it to the supervisor or the compliance
> officer.
>
>
Ahh, ok thanks Ruhi it makes sense now - you should go to your compliance as a last resort only after you tried to encourage the information to become public... But after you try to encourage them and the CEO refuses, should you not go to the compliance department instead of trading on the stock? Because B says to not go to the compliance department but to just trade even if the CEO refuses.
