Securities and Exchange Commission:
Selective Disclosure and Insider Trading
OGC-00-61, Sep 7, 2000
Pursuant to a legislative requirement, GAO reviewed the Securities and Exchange Commission's (SEC) new rule on selective disclosure and insider trading. GAO noted that: the new rule would address three issues: (a) the selective disclosure by various issuers of material nonpublic information; (b) when insider trading liability arises in connection with a trader's "use" or "knowing possession" of material nonpublic information; (c) when the breach of a family or other nonbusiness relationship may give rise to liability under the misappropriation theory of insider trading; and (d) SEC complied with applicable requirements in promulgating the rule.