RIK, here is a letter that I sent to the OSC in regards to Corel. I posted it on the Corel thread for others to sends and this is a more generic version, but still has to be edited. The OSC is considering real time insider disclosure and you can adjust this letter to suit your needs. Please pass on a copy to friends or post to wherever you feel it is applicable. Send it in to whatever Securities Commissions you want. The more people that send in regarding this matter, the sooner the OSC law will change. We can make a difference. Thanks and best of luck.
Complaints/Suite 800/Box 55/20 Queen St. West
Toronto, Ontario/(416)597-0681
To Whom It May Concern,
This is a formal letter of complaint to address the unfair nature of Insider Trading Laws. It is my understanding that insider trading law indicates that trades by insiders should be declared in a "timely fashion". Traditionally, "timely fashion" has been understood to mean "within 30 days of the trade". It is clear to me that, in this day and age, 30 days stretches the definition of "timely fashion", to the detriment of external investors unaware of the inner financial condition of a company. Thus, the insider trading law as it stands, protects the actions of insiders and entirely neglects the obligation that the OSC has to protect ALL investors.
The law should give a specific and reasonable time frame for trades to be declared, such as 5 business days from the beginning of the initiation of the trade. The appropriate document could be sent to the OSC and the Stock Exchange by mail, fax or a phone call. In fact, current technology, such as "electronic tag trading" allows for instant trade reporting. Any of these options would allow a more timely disclosure, as well as benefit all market investors by preventing lawsuits and general investor unrest.
This preoccupation is far from academic. In fact, last summer Corel Corporation insiders, such as Michael Cowpland, declared their trading activity 30 days after selling shares on an unsuspecting market using information that in all likelihood, they were privy to. This was at the same time that statements made by the CEO indicated that the
company's situation was improving, and they would have a successful quarter. These statements created a strong market that helped Mr. Cowpland and other Corel Corp. executives sell their shares at higher prices. In fact, the insider trading law, as it stands, ensured that the insiders would be able to trade large amount of shares, without other investors being alerted to. In this case, it created a situation in which investors purchased over-valued shares in a company that, unknown to them, was struggling with huge losses and future write-offs as it was conveniently anticipated by Corel executives stock sales.
The insider trading actions have led to class action law suits and numerous complaints in the past. It is time to change these laws to protect and preserve fair trading conditions for all investors, as it is your fiduciary duty, instead of allowing some insiders to profit from information unduly delayed from the public.
I am looking forward to your detailed response in regards to this matter, and what action you are willing to take to correct this problem.
Sincerely, |
