Frankly, I'm a little disappointed that I didn't figure this angle out on my own, given (a) the amount of time I spend writing about insider trading, and (b) the fact that I have two teenagers actively using Snapchat, but hey, better late than never. This morning, the Daily Intelligencer reports, CNBC's Jim Cramer asked Preet Bharara, the U.S. Attorney for the SDNY, if Snapchat can be used to share insider trading tips without leaving a trail. Bharara's response: "I don't even know what you're talking about."
For those of you who are, like Bharara, unfamiliar with Snapchat, it is a social media service that allows users--typically teenagers and young men and women in my experience--to share photos or other images with others with an interesting twist. The twist is that after the image is viewed by the recipient for a set number of seconds, it vanishes! You have probably already deduced the risqué use to which millions of teenagers already put Snapchat, but now it appears that there may be a far more lucrative use for the service. What if you could share inside stock information electronically with your buddies without the risk of leaving a digital evidence trail? If you could send someone an image bearing the words "Blue Horseshoe Loves Anacott Steel" and know that the image would not exist 10 seconds after being received by your buddy? Now we're talking!
Of course, as the Daily Intelligencer notes, this gravy train could be in jeopardy now that Bharara knows what Snapchat is, as he'll probably "have an account set up by noon and be snapping photos of handcuffs to hedge-fund traders by one."