This week's Ethicist deals with a doctor who finds out, in his professional capacity, that the CEO of a major company is seriously ill. The doctor wants to know if he can ethically sell his stock in this company. Randy Cohen says this would be considered insider trading.
But then, under the insider trading rules, can the doctor EVER sell his stock? In general, if you acquire insider information, can you EVER change the investment in question? What if he wanted to sell it anyway? What if he needed to liquidate it so he could use the money for something else?
4 comments:
He must wait until it is public information.
I agree with anon.
But I also think the company has an equal ethical and/or moral obligation to come clean about the CEO's condition as soon as possible so that investors who want to make changes for whatever reason can feel free to do so.
If, for some reason, the stock goes up for reasons that could be perceived to be related to the CEO's illness before it becomes public information, could the doctor get in trouble for holding it?
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