Specter of Boesky Rises in New Cases

The head of enforcement for the Securities and Exchange Commission is “quite dismayed” at the number of new insider trading cases she is seeing involving senior-level managers.

Linda Chatman Thomsen, speaking at meeting of compliance officers in Washington, D.C., yesterday said “the tippees and tipsters have been in senior positions of trust and confidence," according to story in today's Financial Times. "We are far from low-level employees or people on Main Street.”

A former Ernst & Young partner was charged last week with allegedly passing information to an investment banker in advance of seven deals involving clients of the large accounting firm. Some 13 defendants, including an executive director at UBS and a compliance officer from Morgan Stanley, have been charged in another case involving an insider-trading scheme.

Thomsen, according to the FT report, described the trend as disturbing, adding that the “quality and behavior” is reminiscent of the ruinous cases involving Boesky and Levine.