Dhani,an accountant for Eureka! Inc. learns of undisclosed company plans to market a new laptop. Dhani buys 1,000 shares of Eureka! stock. He reveals the company plans to Fay,who tells Geoff. Both Fay and Geoff buy 100 shares. Geoff knows that Fay got her information from Dhani. When Eureka! publicly announces its new laptop,Dhani,Fay,and Geoff sell their stock for a profit.
-Under the Securities Exchange Act of 1934,Fay is most likely

Question

Quizplus · Accepted Answer

Fay is most likely liable for insider trading because she traded on non-public information that she received from Dhani, who is an insider of Eureka! Inc. It does not matter that she did not prevent others from profiting or whether she misappropriated any information. Additionally, her employment status is irrelevant in determining liability under the Securities Exchange Act of 1934.

Dhani,an Accountant for Eureka! Inc