SEC Expands Probe into Rule 10b5-1 Plans - Firms Should Prepare to Show Compliance
Recent press stories have revived speculation that corporate insiders may be abusing rule 10b5-1 trading plans to reap unfair profits from inside knowledge of their companies.1 The SEC is reported to have expanded its probe beyond trades highlighted by the press to cover a larger range of executive trading activity.2 Other regulators have launched their own investigations, and investor groups have joined the conversation. This Memorandum highlights techniques that can make it easier to demonstrate compliance with rule 10b5-1.