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Former Apple Lawyer Who Was Supposed To Keep Employees From Insider Trading Has Been Charged With Insider Trading (cnbc.com)

Posted by msmash on from the how-about-that dept.

The SEC Wednesday charged a former Apple executive with insider trading. From a report: Gene Levoff, senior director of corporate law and corporate secretary until September, "traded on material nonpublic information about Apple's earnings three times during 2015 and 2016," according to the lawsuit filed Wednesday in the U.S. District Court of New Jersey. "Levoff also had a previous history of insider trading, having traded on Apple's material nonpublic information at least three additional times in 2011 and 2012. For the trading in 2015 and 2016, Levoff profited and avoided losses of approximately $382,000," the complaint says. Levoff's position at Apple granted him insider access to not-yet-public earnings results and briefings on iPhone sales, the complaint says. On more than one occasion, he disobeyed the company's "blackout" period for stock transactions, selling or buying stock worth tens of millions of dollars, according to the SEC.

63 comments

  1. Illegal for a reason ... by Anonymous Coward · · Score: 0

    There is a reason why this stuff is illegal, and why the SEC takes it seriously.

    As much a lawyers and corporate executives generally have questionable morality when it comes to stuff like this, it's highly illegal because it allows you to profit when the rest of the shareholders might be taking a loss soon.

    If this guy was "responsible for Apple's compliance with securities laws", he was a complete failure at it.

    This is why I assume that without someone enforcing things, every executive of every corporation would thieving son of a bitch. Sounds like Gene Levoff has pretty much helped prove that.

    1. Re:Illegal for a reason ... by jellomizer · · Score: 1

      That and the outsider would spend a lot of time trying to figure out what the insiders are doing.
      Look all these Apple employees buying stock, that means we should buy it too. (a good way to raise the rates)
      Look all these Apple employees selling stock, SELL! SELL! SELL! Then all those Apple Employees buy the stock right back at a discount, moments before Apple releases the iDevice X4.

      Stock Prices should me controlled by the "Invisible Hand of capitalism". However people found a way to trick it, thus we now need laws to stop all the tricks.

      --
      If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    2. Re: Illegal for a reason ... by dougdonovan · · Score: 1

      do what i say, not what i do.

    3. Re:Illegal for a reason ... by Anonymous Coward · · Score: 0

      It isn't like insider trading is rare. Watch C-levels as they short all the stock they get before they make an announcement that their company was hacked. I'm amazed more people are not jailed for this.

    4. Re:Illegal for a reason ... by jriding · · Score: 1

      we don't jail the rich.
      What would the other rich think?

      --
      love the taste, hate the texture
    5. Re: Illegal for a reason ... by Anonymous Coward · · Score: 0

      who will watch the watchers, or something like that

    6. Re: Illegal for a reason ... by Zontar+The+Mindless · · Score: 1

      Quis custodiet ipsos custodes?

      --
      Il n'y a pas de Planet B.
    7. Re: Illegal for a reason ... by Anonymous Coward · · Score: 0

      Hire another watcher to watch the watcher, of course.

      Who will watch the watching watcher? Well... it's watchers all the way up.

  2. Imagine the temptation by timeOday · · Score: 1

    Push this button, and you will make millions. More than in two lifetimes of honest work.

    1. Re:Imagine the temptation by HornWumpus · · Score: 0, Troll

      Been there done that. Not a federal prisoner.

      I saw a bug report, a major publicly traded utility overflowed the grand total on their power trading VAR report (only had digits for 99 _billion_ $). I'm not _filthy_ rich because I'm afraid of the SEC. If only I was a Clinton...

      --
      John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
    2. Re:Imagine the temptation by GameboyRMH · · Score: 4, Insightful

      It shouldn't be as tempting when you're a highly paid corporate lawyer, wealthy enough to play with 8 digits' worth of stocks...but that's the difference between regular greed and insane greed I guess.

      --
      "When information is power, privacy is freedom" - Jah-Wren Ryel
    3. Re:Imagine the temptation by Anonymous Coward · · Score: 2, Insightful

      It shouldn't be as tempting when you're a highly paid corporate lawyer, wealthy enough to play with 8 digits' worth of stocks

      Except that greed begets more greed, and anybody telling you how the "free market" solves these problems is lying to you. The more wealthy you are, the more you feel entitled to dip your beak, because you are special and privileged.

      Human nature tells us that people are selfish assholes only out for their own interests. Any economic or social theory which says that doesn't happen is a complete fucking lie.

      Which in my book is capitalism, communism, and most religions because they all seem to be predicated on deluding yourself into believing that people aren't intrinsically assholes by their very nature.

      You can't go around claiming your -ism works when you have fundamental assumptions which defy logic and reality about what people really do.

      I fail to see why a highly paid corporate lawyer would be any less tempted to be a lying selfish asshole. In fact, I consider it more likely.

    4. Re: Imagine the temptation by Anonymous Coward · · Score: 0

      The guy is potentially losing his freedom over a 5% increase in his already significant trading funds. Sounds like a gambling problem. We need public screening for mental health of all CxOs.

    5. Re: Imagine the temptation by GameboyRMH · · Score: 3, Insightful

      That would seriously leave few current CEOs in office. Think about how many are considered "eccentric," and that "eccentric" just means "crazy but wealthy." And then consider that most of the apparently level-headed ones are also psychopaths. If CEOs were hired on merit they would indeed be required to undergo mental health evaluations to get that position.

      --
      "When information is power, privacy is freedom" - Jah-Wren Ryel
    6. Re:Imagine the temptation by 110010001000 · · Score: 1

      100% insightful

    7. Re:Imagine the temptation by Anonymous Coward · · Score: 0

      Depending on where you work, it's really not that hard to come across actionable inside information. Even as a lowly software developer, it's not uncommon to know about major new features, applications, or projects that could raise a company's value well before the company has anything to announce. Alternatively, it's not uncommon to know about major bugs or breaches days, weeks, or even months before they go public. Similarly, IT people may know about the revocation of credentials for high-profile employees whose departures haven't yet been disclosed.

      Where I work as a software developer doing B2B custom apps, I once walked into a buddy's office and overheard him tell his subordinates that publicly-traded company X was about to acquire our publicly-traded client Y, so we'd be updating all of the logos, copyright info, etc. in the custom apps we had built for Y to instead say X. Likewise, my pal was having his guys revoke everyone's credentials in an app I had actually helped build for Y, since the acquisition was going to be accompanied by mass layoffs, and Y didn't want disgruntled employees grabbing proprietary info or trade secrets before they were shown the door.

      Neither the acquisition nor layoffs had been made public yet. The acquisition was due to be announced the next day, and the layoffs sometime later. It would have been easy for me to go home and move some funds into Y in advance of the disclosure. I didn't find it particularly hard to resist that temptation.

    8. Re:Imagine the temptation by HiThere · · Score: 1

      Sorry, but you should rephrase that slightly to:
      Human nature tells us that some people are selfish assholes only out for their own interests.

      Even that's an overstatement, though sometimes it's hard to believe.

      --

      I think we've pushed this "anyone can grow up to be president" thing too far.
    9. Re:Imagine the temptation by Anonymous Coward · · Score: 0

      It shouldn't be as tempting when you're a highly paid corporate lawyer...

      How about this, if you have or are expected to have access to material non public information your not allowed to instant sell any stock that is covered by it.

      Congressmen couldn't do it.
      Employees couldn't do it.

      If you want to sell stock you schedule it several months in advance, or more, if that's what it takes. That wouldn't stop all of it, but it would a good chunk of it. Of course if you tip, you would still go to jail, but you can at least remove some temptation from those who can easily abuse it.

    10. Re:Imagine the temptation by Anonymous Coward · · Score: 0

      He is in a position where he was already making millions. I don't understand the temptation at all (in quite a good position myself). Why risk Jail when you are already set for life simply to have an "extra" holiday house and Ferrari in the Garage.

    11. Re:Imagine the temptation by gravewax · · Score: 1

      except that is not the position he is in at all. He is already a very rich and successful lawyer at the top of his career with enough investment that the insider trading saved him over $300k. I am no where near that level yet but I would not be tempted for even a second to risk everything I earned in life plus destroying my future and a potential jail term to avoid making what for him was a relatively small lose on the markets.

    12. Re:Imagine the temptation by rtb61 · · Score: 1

      It is not the ism, it is the psychopaths who plot and scheme to gain control of the ism. Can be quite readily stopped, simply introduce testing for psychopathy and act accordingly and the majority of problems will stop, as easy as that. Doesn't ,matter what you create a psychopath will seek to gain control of it and run it to feed their own greed, ego and lusts through to collapse of the ism, every single time, the ism lasts until a psychopath gains control of it.

      --
      Chaos - everything, everywhere, everywhen
    13. Re:Imagine the temptation by Anonymous Coward · · Score: 0

      those are ALREADY the rules. public traded stocks for anyone with access to sensitive information is subject to blackout periods and executives are subject to having to declare their trading in advance.

  3. I think Apple folows the simular logic. by jellomizer · · Score: 4, Insightful

    Just as we tech people say. Lets hire a convinced black hat hacker, as your IT security expert, because they would know how it is done. Lets hire a lawyer convicted in insider trading to stop other employees from doing it, because he knows how it is done.

    There are two problems witch such logic.
    1. the Convicted part: They got caught... So how good can they be.
    2. They have shown a history of poor ethical thinking skills. Such jobs with high level of responsibility and general access to information, a strong ethics background is needed.

    --
    If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    1. Re:I think Apple folows the simular logic. by Anonymous Coward · · Score: 0

      Probably a great BS-er, and convinced them he was all reformed and stuff.

    2. Re:I think Apple folows the simular logic. by jellomizer · · Score: 2

      The problem is, even in my job, I need to be conscious of my personal ethics all the time. They are so many things that I could get away with, which I don't attempt due to my ethical standard. And usually a few times a week, I need to ask myself, what it the Right thing to do. Not the Best thing to do.
      You need to be sure that you do do not cross the line, and the sliding scale is easy to tip. Small lapses makes it easier to do larger lapses, until you have crossed the line, or if your lucky got close enough to see the edge.

      You could be honest and say I will never do that again... However over time if you have a poor ethical self perception, you will start sliding back into your activities.

      Oddly enough White Collar crime is more prone to reoccurrence and harder to stop. Because for a lot of the blue collar crimes, if you take the person out of the environment they can get better.

      --
      If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    3. Re:I think Apple folows the simular logic. by PseudoThink · · Score: 1

      I think the problem with this witch logic is that it frames people as immutable being, incapable of growing or changing in a positive manner from prior experiences.

      For every bad apple that doesn't reform themselves, I think there are likely more "reformed apples" that improve themselves and change for the better. In some ways, I think reformed people may become even more averse to the original behavior than an average person who never exhibited that behavior.

      I think a "reformed criminal" can very much be a "convert", and consequently much less likely to make future offenses. However, that's not everyone, so then you get this scenario, too.

    4. Re:I think Apple folows the simular logic. by Anubis+IV · · Score: 3, Informative

      Just as we tech people say. Lets hire a convinced black hat hacker, as your IT security expert, because they would know how it is done. Lets hire a lawyer convicted in insider trading

      You've got your facts wrong; he's never been convicted. The CNBC article and Slashdot summary are rather ambiguous in their phrasing, hence your understandable confusion, but if you check other reporting on the story, you'll see that what's actually going on is that he's just now being accused of crimes committed in 2011 and 2012, as well as 2015 and 2016. Apple didn't hire a convicted inside trader and he's never been charged with insider trading prior to now.

      In fact, so far as Apple's response to his activities go, they put him on a leave of absence last summer when they were first notified that he was being investigated, then fired him themselves a few weeks later when their internal investigation turned up evidence of wrongdoing. The SEC is now following up with formal charges of their own, again, for the first time.

    5. Re:I think Apple folows the simular logic. by gravewax · · Score: 1

      No it doesn't frame them as such at all. It frames them as a high risk as they have already proven that given the right temptation their ethics and moral compass are "flexible". maybe it is a once off, maybe not. But you know they have failed at least once so the responsible thing to do is ensure they are not in a position with such temptations again. It doesn't mean don't hire them or use their knowledge, but ensure it is properly supervised with no such tempations.

  4. Hmmm by Anonymous Coward · · Score: 0

    Rampant fraud and cruelty what else is new in the big corps?

    1. Re: Hmmm by Anonymous Coward · · Score: 0

      Incompetence, harassment, you know, it all usually happens at the same time. I hope they have someone to pay off which is the way these kind of people usually avoid penalties. If there is nobody to pay off then they will be a tad uncomfortable while the autboritieis comb through their finances

  5. Rules Are For Poors by Anonymous Coward · · Score: 0

    America is just another shithole country.

  6. Re: Always Knew Wumpus Is Scum by Anonymous Coward · · Score: 0

    Hey dont you mean like a Bysg trading with the Nazis & Saudis? Because THATS real fucking money, not that pissant Clinton level shit.

    Youre a hypocrit and a moran.

  7. Don't you mean...? by Anonymous Coward · · Score: 0

    Insider trading is frowned upon. However, his actions in doing so, in the face to criticism and scrutity, can only be decribed as "courageous".

  8. $382k/2 years? by Anonymous Coward · · Score: 0

    This guy risked his entire career and fines and possible (though long shot) jail time over $191k a year? I would think a "senior director of corporate law" at Apple would earn at least that much. It's not his insider trading that I'm concerned about so much as his stunning lack of risk/reward analysis.

    1. Re:$382k/2 years? by Pinky's+Brain · · Score: 1

      That's just what they can prove.

      Probably the vast majority of stock trades he has ever made was on insider information either acquired himself or from connections, just generally with more deniability. It's easy to get lazy with routine tasks.

    2. Re: $382k/2 years? by Anonymous Coward · · Score: 0

      Hes a jew so its kinda in his blood, aint it?

  9. It takes one to know one. by grep+-v+'.*'+* · · Score: 1

    What's the problem? It's only money.

    --
    If the universe is someone's simulation -- does that mean the stars are just stuck pixels?
  10. Well on form for Apple by Anonymous Coward · · Score: 0

    With Apple being so genuinely dishonest and greedy, he seems to have found perfect company at Apple.

  11. Misuse by PPH · · Score: 4, Interesting

    I worked for a seedy outfit that repeatedly manipulates it's share prices. One day, the boss called everyone into a mandatory, absolutely must attend staff meeting. So, we go in and listen to a bunch of the usual b.s. Then he plops a market share comparison of our outfit and our major competitor based in Toulouse. It looked pretty bad (for us). He then informed us that the chart he had shown us was considered 'material non-public information' and we were now prohibited from selling any of our company stock for a defined period. No surprise, our company stock tanked.

    We didn't need to see this chart to do our daily jobs. It was just a maneuver to keep employees from heading to the exits with the rest of the market watching.

    --
    Have gnu, will travel.
    1. Re:Misuse by Anonymous Coward · · Score: 0

      So, we go in and listen to a bunch of the usual b.s. Then he plops a market share comparison of our outfit and our major competitor based in Toulouse. It looked pretty bad (for us). He then informed us that the chart he had shown us was considered 'material non-public information'

      IANAL, but I doubt that is material non-public information.

      If your market share is private, valuable info, then how do you know the market share of your competitor?

    2. Re:Misuse by PPH · · Score: 1

      then how do you know the market share of your competitor

      Industrial espionage.

      --
      Have gnu, will travel.
    3. Re:Misuse by Dorianny · · Score: 1

      That doesn't make much sense. Without that information there would be no reason for "heading to the exits" and once the information was released you would have been free to panic-sell with the rest of the market

    4. Re:Misuse by PPH · · Score: 1

      Without that information there would be no reason for "heading to the exits"

      Workers can often tell when a company is in trouble. That might still be considered inside information. But gut feelings are a lot less likely to attract SEC attention than actual internal documents.

      free to panic-sell with the rest of the market

      The rest of the market includes a lot of people who can afford portfolio managers who can act on a press release within minutes. I can't get off the assembly line to a phone until break time. I'd be selling into the bottom of the market.

      --
      Have gnu, will travel.
    5. Re:Misuse by Spamalope · · Score: 1

      And companies that can simply spy on that information. Possibly that can see everything certain handheld devices contain, can get that information without running afoul of the rule. Possibly. But if that were happening, the companies in that position would profit so much they'd be rich cash cows.

      Nah, that'd never happen. Apple and Google are struggling financially, right?

    6. Re: Misuse by EricSchatz · · Score: 1

      Itâ(TM)s non-public information because they subscribe to industrial tracking services that charge a fee for the share info. Just like the competitors do.

    7. Re:Misuse by Anonymous Coward · · Score: 0

      Just a scare tactic. SEC would have done nothing if you sold it all the second you left that meeting.

      Which is what you should have done.

    8. Re:Misuse by Anonymous Coward · · Score: 0

      yeah bullshit. The SEC prosecute upwards of a thousand of these cases every year. Blatant cases where they have been duly informed of their responsibilities are open and shut cases for them.

    9. Re: Misuse by gravewax · · Score: 1

      That is still considered public information, if you can source the information from a service be it free or otherwise it is public. Non-public market information is reserved purely for information about the company that would have a material affect on the share price that can only be obtained internally to the company.

    10. Re:Misuse by gravewax · · Score: 1

      given the information described isn't actually non-public sensitive information yeah the SEC would have done nothing. If it was something like unpublished financial numbers not yet released to the public that would be a whole other situation.

  12. I've got some insider info for you by slashmydots · · Score: 0

    All their products in the last 5 years have been defective garbage, they're still abusing patents and stealing other people's work, they're still abusing a monopoly, they still lie to their customers about defects until they're sued, they're still violating right to repair laws, and every time they release some overpriced, underperforming, stripped down garbage you should short their stock. Just a little insider secret for all you investors out there.

  13. Self sacrifice? by Headw1nd · · Score: 0

    Is this like jumping on a grenade, did he quickly trade on these secrets to keep his fellow Apple employees from doing it themselves?

  14. How the worm turned by DaMattster · · Score: 1

    This is a little bit shocking. Say goodbye to membership to the bar and law license.

  15. Meeting objectives by Livius · · Score: 1

    For all I know, if he kept insider trading down to only one employee, maybe that's considered good in this line of work.

  16. Levoff sounds like a jew's name by Anonymous Coward · · Score: 0

    Levoff sounds like a jew's name so typical jew crookery at work here. Nothing new.

  17. Simple Requirement by registrations_suck · · Score: 1

    Require all eligible employees to EITHER:

    1). File a buy/sell plan on the first business day of the year. The plan must indicate, by transaction type (buy/sell), amount of stock and transaction date, all of their transactions for that calendar year. Make such plans irrevocable after being filed.

    2). Require a 120 day lead time on all transactions, and make them irrevocable once declared.

    Do that, and they will have to get a lot more complicated about their insider trading schemes.

    1. Re:Simple Requirement by Spamalope · · Score: 1

      Remove insider trader exemptions from members of Congress while you're at it. (and anyone else in the Gov't who might have information)
      They've got lots of material insider information just from by knowing future tax and regulatory policy, before you get to any required filings by the company or information surveillance agencies have. (So, do black programs get funded via insider trading based on info from intercepts?)
      For all of us, in practice this stacks the deck against at least our 401k mutual fund investments.

  18. apple by Anonymous Coward · · Score: 0

    The Home of Hypocrisy!!

  19. Like Sexual Harassment training... by Anonymous Coward · · Score: 0

    It's like sexual harassment training - you take it so that the rank and file managers dont get sexual harassment claims, otherwise it might open scrutiny to the top level managers who really are sexually harassing people, or in this case, insider trading,

  20. Restricting insider trading is bad by Anonymous Coward · · Score: 0

    Not only it is stupid and useless as this news tell us... it is just plain evil.

    The only insider trading that is inmoral is the one done by government officials, and only because everything around government is inmoral.

  21. FTFY by Anonymous Coward · · Score: 0

    "Who Was Supposed To Help Employees Get Away With Insider Trading."

  22. It's rigged by Anonymous Coward · · Score: 0

    The stock market is rigged against the little guy. We should just admit it, and legalize insider trading.

  23. Hey Jew can you confirm this? by Anonymous Coward · · Score: 0

    Khazar Talmudic Jews believe this of all they call goyim/gentiles (any non-jew): Jews = biggest racists of all for which they "jew guilt" you for no less! They're hypocrites known as thieves all thru history or were Argentines in the 1940 under Peron, Spanish inquistion, France (1306), Egypt (despoiled/robbed by jews), Arabs (pre & post 1948), England (1330 Edward longshanks), Romans under titus, Russia pogroms and Germany who got rid of them from their nations nazi german's too? No. Driven into DESERTS ages ago! Don't wonder why after all those exilings above.

    Should anyone doubt any of this see Jacob Javits' crony Rosenthal spill the beans on it https://www.youtube.com/watch?v=D4zMVZ8HnFI/ where he called all Christianity fools for helping Israel and the biggest scam of all time per their beliefs below from their Talmud.

    This is the province of the synagogue of Satan (Pharisees whom Jesus Christ himself kicked to the curb out of the temple & they killed him for it. Jeremiah did the same to them also + the Essenes could not stand them either breaking away from the pharisee corruption):

    Jew Talmud excerpts (the book that calls Christ's mother a whore & a bastard of a roman soldier):

    1. Sanhedrin 59a: "Murdering Goyim is like killing a wild animal."

    2. Abodah Zara 26b: "Even the best of the Gentiles should be killed."

    3. Sanhedrin 59a: "A goy (Gentile) who pries into The Law (Talmud) is guilty of death."

    4. Yebhamoth 11b: "Sexual intercourse with a little girl is permitted if she is three years of age."

    5. Schabouth Hag. 6d: "Jews may swear falsely by use of subterfuge wording."

    6. Hilkkoth Akum X1: "Do not save Goyim in danger of death."

    7. Hilkkoth Akum X1: "Show no mercy to the Goyim."

    8. Choschen Hamm 388, 15: "If it can be proven that someone has given the money of Israelites to the Goyim, a way must be found after prudent consideration to wipe him off the face of the earth."

    9. Choschen Hamm 266,1: "A Jew may keep anything he finds which belongs to the Akum (Gentile). For he who returns lost property (to Gentiles) sins against the Law by increasing the power of the transgressors of the Law. It is praiseworthy, however, to return lost property if it is done to honor the name of God, namely, if by so doing, Christians will praise the Jews and look upon them as honorable people."

    10. Szaaloth-Utszabot, The Book of Jore Dia 17: "A Jew should and must make a false oath when the Goyim asks if our books contain anything against them."

    11. Baba Necia 114, 6: "The Jews are human beings, but the nations of the world are not human beings but beasts."

    12. Simeon Haddarsen, fol. 56-D: "When the Messiah comes every Jew will have 2800 slaves."

    13. Nidrasch Talpioth, p. 225-L: "Jehovah created the non-Jew in human form so that the Jew would not have to be served by beasts. The non-Jew is consequently an animal in human form, and condemned to serve the Jew day and night."

    14. Aboda Sarah 37a: "A Gentile girl who is three years old can be violated."

    15. Gad. Shas. 2:2: "A Jew may violate but not marry a non-Jewish girl."

    16. Tosefta. Aboda Zara B, 5: "If a goy kills a goy or a Jew, he is responsible; but if a Jew kills a goy, he is NOT responsible."

    17. Schulchan Aruch, Choszen Hamiszpat 388: "It is permitted to kill a Jewish denunciator everywhere. It is permitted to kill him even before he denounces."

    18. Schulchan Aruch, Choszen Hamiszpat 348: "All property of other nations belongs to the Jewish nation, which, consequently, is entitled to seize upon it without any scruples."

    19. Tosefta, Abda Zara VIII, 5: "How to interpret the word 'robbery.' A goy is forbidden to steal, rob, or take women slaves, etc., from a goy or from a Jew. But a Jew is NOT forbidden to do all this to a goy."

    20. Seph. Jp., 92, 1: "God has given the Jews power over the possessions and blood of all nations."

    21. Schulchan Aruch, Choszen H

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