To: Anthony@Pacific who wrote (62618)
From: Anthony@Pacific Friday, November 10, 2000 7:44 PM ET
Reply # of 62628
We need better timeliness !!
SEC May Require Executives to Report Insider Trades on Edgar
Washington, Nov. 8 (Bloomberg) -- Corporate executives buying
or selling their own company's stock would be required to report
the insider trades to regulators electronically under a rule in
the planning stages at the Securities and Exchange Commission, an
agency spokesman said.
``We're anticipating rule changes with regard to mandated
electronic filings,'' the SEC's John Heine said.
Currently, corporate executives and directors must file forms
with the SEC when they buy and sell their own company's stock.
They can file electronically over the SEC's Edgar computer system
if they want, but the vast majority file on paper.
The Wall Street Journal reported today that the SEC
anticipates mandating electronic filings of forms for reporting
stock ownership and transactions as well as those reporting the
intent to sell.
The SEC mentioned the coming rule changes on April 24 in a
footnote to a separate rulemaking package issued that day
involving Edgar.
``We anticipate that we will propose to make (the forms)mandated Edgar filings,'' the SEC said.
Edgar, which is short for Electronic Data Gathering,
Analysis, and Retrieval system, lets company that sell stock to
the public file reports with the SEC by computer instead of on
paper. Domestic companies are required to make most regulatory
filings over Edgar.
Knowing Sooner
The rule would apply only to legal insider transactions.
Corporate executives can trade in their company's stock as long as
they don't use confidential information to gain an advantage in
their transactions. Many investors use executives' inside trades
as a measure of top officers' faith in a company's prospects.
The new rule ``would be a good thing. If investors can know
sooner, it's better,'' said Michael Painchaud, principal director
of research for Market Profile Theorems, a Seattle advisory
service that monitors insider trading.
``We have new technology now which allows a different
definition of (timely reporting),'' Painchaud said. ``That
technology should extend to corporate insiders,'' he said. Mauri Osheroff, associate director of corporation finance at
the SEC, said the agency will probably propose a rule for public
comment next year.
Corporate executives don't have to file reports immediately
under current federal securities laws. They must file within 10
days after the end of the month that they buy or sell stock.
Critics say current law gives executives as much as a 40-day
lag time between when they buy or sell company stock and when
reports are due.
``If an insider trades stock on September 1, then October 10
is the deadline,'' said Robert Gabele, director of insider
research at First Call/Thomson Financial, which tracks and
analyzes the stock and option ownership of U.S. corporate
insiders.
``Not only do these filings need to be on Edgar, but there
needs to be something done about the timeliness of these
filings,'' Gabele said. ``Electronic filing is a good first step,
but it's not the panacea.''
Gabele said he has received no signals that the SEC will ask
Congress to change the timetable.
The SEC also may propose that foreign companies file with the
agency over Edgar, according to the April footnote. Currently,
foreign filers can submit most filings on paper.
--Vicky Stamas in Washington at (202) 624-1958 or
vstamas@bloomberg.net /ba |
