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SEC’s Mary Schapiro Calls Insider Trading a ‘Problem of Tremendous Magnitude’

Securities and Exchange Commission Chairman Mary Schapiro told  hedge fund industry conference attendees on Thursday that insider trading is a “problem of tremendous magnitude,” reports the Wall Street Journal.

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Mary Schapiro Says that the SEC is the Middle of Several Cases

Mary Schapiro’s comments about insider trading came in answer to questions posed by former SEC Chairman Harvey Pitt, as he asked her about her views on the broader insider investigations at hand. Schapiro continued by saying that her agency is in the middle of “many cases and investigations” in that realm. To date, more than a dozen people have been charged as a result of the industry-wide probe. Schapiro did not mention any specific investigations.

Mary Schapiro Discussed Hedge Fund Regulation

Mary Schapiro did touch on an important issue regarding hedge fund regulations, specifically those hedge funds that have asked whether the rules are really clear enough. Schapiro said “There is a line — I think it is pretty bright line — when you cross over into insider trading.”  She continued by expressing that Insider trading is not a “victimless crime” – at a minimum, such instances undermine ” the confidence and integrity in our markets.” She concluded by saying that “final rules governing systemic risk reporting would be voted on next week by the SEC.”