Insider Trading Vigilance Urged by SEC as Virus Increases Risks

(Bloomberg) -- Corporate executives whose work arrangements have been turned upside down by coronavirus are being urged by U.S. regulators to guard against a potential jump in insider trading, especially in cases where companies have been granted delays in reporting financial data.

Changes forced by the pandemic could result in more people having access to material nonpublic information that might have even greater value than it would under normal circumstances, the co-directors of the Securities and Exchange Commission’s enforcement unit said in a statement Monday.

“Those with such access -- including, for example, directors, officers, employees, and consultants and other outside professionals -- should be mindful of their obligations to keep this information confidential and to comply with the prohibitions on illegal securities trading,” Stephanie Avakian and Steven Peikin said in the statement.

Earlier this month, the agency granted certain firms an extra 45 days to meet public filing deadlines that were to hit in March and April. To take advantage of the time extension, the SEC said a company would have to explain to the regulator why it couldn’t meet its normal deadline via a “brief description.”

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