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6/29/2018
11:15 AM
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Equifax Software Manager Charged with Insider Trading

Sudhakar Reddy Bonthu used insider information about the company's 2017 data breach to profit in stock transaction.

Fallout from the epic Equifax data breach just keeps coming: A second employee of the credit-monitoring firm has been charged with insider trading in connection with the attack.

Former Equifax software development manager Sudhakar Reddy Bonthu, 44, was arraigned in US District Court in Atlanta this week. Bonthu allegedly using his inside knowledge of the 2017 data breach before it was made public and purchased so-called "put" stock options that allowed him to earn more than $75,000 in profit when the announcement was made and Equifax's stock dropped.

Equifax's former chief information officer, Jun Ying, earlier this year pleaded not guilty to charges of insider trading related to the data breach.

Read more here

 

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RyanSepe
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RyanSepe,
User Rank: Ninja
6/29/2018 | 1:55:02 PM
Not Surprising
This is not surprising to me in the least. I would be surprised however if it was to be the last person charged in light of the Equifax breach.
Dr.T
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Dr.T,
User Rank: Ninja
6/29/2018 | 2:45:09 PM
Re: Not Surprising
I would be surprised however if it was to be the last person charged in light of the Equifax breach. I would agree. But these are mistakes after the mistakes, not root course of the problem they are in.
RyanSepe
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50%
RyanSepe,
User Rank: Ninja
6/29/2018 | 2:00:27 PM
Best Practice?
Can someone explain to me what is best practice in these scenarios? I find it somewhat confusing. If someone inadvertently told you that your investments were going to plummet unless you dropped them due to an event with the company are you suppose to just steer your boat into the iceberg? 

This is a cynical representation of it of course but seriously I can't fathom being in that position and would like someone who is better versed legally to shed some light on the matter.
Dr.T
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Dr.T,
User Rank: Ninja
6/29/2018 | 2:46:42 PM
Re: Best Practice?
Can someone explain to me what is best practice in these scenarios? I think this is a good question. I am not sure if thee is a best practice in this case.
BradleyRoss
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BradleyRoss,
User Rank: Moderator
6/30/2018 | 2:26:14 PM
Re: Best Practice?
I think that the problem is that there is no defined best practice with regard to securing the data.  The comment that I heard from someone at the FBI was that if they published a best practice or good practice document, people might hold them to it and use the document to avoid legal penalty.  I was somewhat incredulout about this answer since it meant that lack of a "good practices" document made it almost impossible to bring a legal charge against the firm.

Insider trading is a different matter in the law more clearly specifies what constitutes a breach of the law.  It is therefore much easier to bring criminal charges and obtain a guilty verdict.
REISEN1955
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REISEN1955,
User Rank: Ninja
7/2/2018 | 10:31:58 AM
Re: Best Practice?
I cannot help but think that many Equifax employees will have great new careers at Wells Fargo. LOL
Dr.T
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Dr.T,
User Rank: Ninja
6/29/2018 | 2:48:04 PM
Re: Best Practice?
This is a cynical representation of it of course but seriously I can't fathom being in that position and would like someone who is better versed legally to shed some light on the matter. I would say this would depend on circumstances of the case, each case would be different, mainly around intention.
blackjack0021
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blackjack0021,
User Rank: Apprentice
6/30/2018 | 1:08:11 AM
Re: Best Practice?
First, he didn't sell stock he already owned to avoid the decrease in value. He purposefully purchased PUT options. Meaning he placed a bet the stock would drop, and when it did he cashed in. Second, google insider trading wiki. Best practice doesn't mean anything here, there are specific laws that say what you are NOT ALLOWED to do. And yes, you could be stuck knowing your stock is about to become worthless, and you can't legally sell it before the news breaks, or warn others to do so.
Dr.T
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Dr.T,
User Rank: Ninja
6/29/2018 | 2:44:16 PM
Fallout
Fallout from the epic Equifax data breach just keeps coming For me it it is better to focus on why these type of massive attacks happenin the first place and the focus on what people did wrong once it happened. We have no clue what went wrong.
Dr.T
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Dr.T,
User Rank: Ninja
6/29/2018 | 2:49:49 PM
CIO
Equifax's former chief information officer, Jun Ying, earlier this year pleaded not guilty to charges of insider trading related to the data breach Charges on insider trading? How about not securing the network as it should be, so no charge on that!
blackjack0021
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blackjack0021,
User Rank: Apprentice
6/30/2018 | 1:16:24 AM
Re: CIO
Come on, reality check. If we charged every CIO who oversaw a network that wasn't 100% secure, and/or patched.... you'd be charging EVERY CIO. Drop down to 90% secure/patched and you'd only have to charge 90% of CIO's, etc. Veracode publicly said they saw 90% of their customers STILL had systems with the same Apache Struts app unpatched six months after Equifax. Not making excuses for them, but being outraged doesnt change reality.... every company has similar issues, and everyone's data was already stolen.
Joe Stanganelli
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Joe Stanganelli,
User Rank: Ninja
7/2/2018 | 5:05:20 PM
Re: CIO
@blackjack: To say nothing of the fact that there is no such thing as 100% secure -- unless you have 0% accessibility.

Moreover, to open CIOs and their ilk up to criminal charges for this kind of thing would mean that they would command mega-salaries in excess of their CEOs -- so as to compensate for the risk.
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