In the financial news today was an article about three investment bankers getting charged for running an insider trading scheme. The bankers worked at Goldman, Moelis and Centerview, and the scheme ran from 2012 to 2018 targeting M&A deals mainly in the pharma space. Along the years there’s been many other similar cases, ranging from a Lazard managing director who passed on tips to fund his affair with a mistress, to SAC Capital’s gigantic insider trading operation.
In a general sense I can understand the urge to engage in insider trading. It’s simple. Greed is a basic instinct. But it’s difficult to understand why certain people can’t suppress that urge given that the risk/reward seems unfavorable. I use the word “seems” here because there is a chance that my assumptions are wrong; perhaps only a fraction of people get caught and that the smartest ones end up making a crazy amount of money consequence free.
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