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SEC Uses Bristol-Myers Exec's Internet Search History Against Him in Insider Case

Bruce Carton | August 4, 2012

If you were about to engage in insider trading by trading stock options in companies you learned were acquisition targets, you might naturally have some anxiety and some questions. For example, you might ask yourself:

  • “can stock option be traced to the purchaser?"
  • can “illegal insider trading options be traced traced?” 
  • What are some “Ways to Avoid Insider Trading?”
  • What are the "Types of Insider Trading?"
  • What is the "Purpose of Insider Trading Laws?"
  • Has the SEC brought any cases arising from illegal trading in call options in advance of an acquisition announcement?

The SEC alleges that Robert D. Ramnarine, an executive at Bristol-Myers Squibb, had those very questions--and conducted Yahoo! searches for those phrases and relevant articles on his work computer at his job as an executive at Bristol-Myers Squibb. The SEC claims that despite presumably learning from these searches and articles that stock options can be traced to the purchaser and the SEC does bring such cases, Ramnarine nonetheless engaged in insider trading in stock options of companies that he learned were potential targets through his employment. The SEC's complaint alleges that Ramnarine made more than $300,000 though his trades. 

Daniel M. Hawke, Chief of the SEC Enforcement Division's Market Abuse Unit, commented that "Ramnarine tried to educate himself about how the SEC investigates insider trading so he could avoid detection, but apparently he ignored countless successful SEC enforcement actions against similarly ill-motivated individuals who paid a heavy price for their illegal trading.”