The U.S. Securities and Exchange Commission was allowed to pursue a lawsuit against two former brokers who sought to upend how the regulator battles insider trading. But the victory may be short-lived.
Bloomberg News reports that a federal judge said SEC lawsuits don’t require the tougher evidence rules laid out for criminal cases in a December appeals court decision. He added that it was a tough call, and agreed to delay the civil trial of the two men until the U.S. Supreme Court decides whether to address the matter.
The showdown comes as the Obama administration seeks high court review of a ruling by the U.S. Court of Appeals in New York. In reversing the insider trading convictions of two fund managers, that court said prosecutors must show a defendant knew a tip came from someone required to keep it secret, and was given something for leaking it.
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