Matt Levine, Columnist

Insider Trading on Tender Offers Is Still Illegal

Don't insider trade based on what you read here. Don't insider trade based on what you read here. Don't insider trade based on what you read here. Don't ...

February 12, 2015 at 12:00 PM UTC

By Matt Levine

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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I like my insider trading coverage to be helpful, so here's a case that may be of interest to all the potential insider traders out there. NCR Corporation bought Radiant Corporation in a deal announced on July 11, 2011. Between May and July 2011, according to the Securities and Exchange Commission, Radiant's chief operating officer talked to a former fraternity brother of his and, "shared material, nonpublic information" with him "concerning NCR's potential acquisition of Radiant."

The fraternity brother, in turn, allegedly shared the information with his "close friend" of more than 20 years, Charles Hill. Hill, who "previously had never traded Radiant securities," then allegedly went out and bought a bunch of Radiant stock "in his two newly opened brokerage accounts, and in each of his three daughters’ custodial brokerage accounts." He sold the stock the day after the deal was announced, making a profit of about $744,000. The SEC is going after Hill for the money.