Mark Cuban has been one of the critics of the movement to expose the NSS scam and has been deemed a "hero" by many self-styled "cyber sleupps," including the hypocrite in chief here on SI. Although I don't wish any ill on Cuban and admire a lot of what he does both in sports and in business, I wasn't surrprised to see him defended even before he responded to today's SEC charges by an SI poster, who so quickly has been critical of posters discussing manipulative shorting and shorters and who was the main defender of the short poster/guru who was convicted of Federal criminal charges.
In any event, here is today's story on Cuban. Innocent until proven guilty, but posted for the irony as he so often is quick to claim that NSS is overblown as an issue.
NOVEMBER 17, 2008, 12:18 P.M. ET SEC Charges Mark Cuban With Insider Trading
By KARA SCANNELL
Mark Cuban
The Securities and Exchange Commission filed insider trading charges against Mark Cuban, the outspoken owner of the Dallas Mavericks, for allegedly dumping shares in Mamma.com upon learning it was raising money in a private offering (full text of complaint can be found on the site).
The SEC alleges in a civil action that Mr. Cuban sold his entire 6% ownership stake on June 28, 2004, after learning that Mamma.com was raising money through a private investment in a public entity, or PIPE. The next day, on June 29, the company announced the PIPE financing and shares of the company dropped by more than 10%. By selling his stake, the SEC alleges, Mr. Cuban avoided more than $750,000 in losses.
In a PIPE transaction new shares are issued at a discount to the current trading price. An announcement of a PIPE transaction is often followed by a drop in the stock price as shareholders anticipate their stake will be diluted.
Write to Kara Scannell at kara.scannell@wsj.com |
