FBI Enlists Gordon Gekko and Mickey Mouse to Stop Insider Trading -- really, ya gotta see this.

February 28, 2012

You know, I'm guessing, really guessing here, that the folks at the Federal Bureau of Investigation were well-intentioned when they decided to put together a public service announcement about insider trading.  Of course, the road to Hell is paved with good intentions. . . and more than a few awkward, painful PSAs.

VISIT:  FBI Announces Public Service Announcement by Michael Douglas on 

Cover of

Securities Fraud and Insider TradingPreviously Unreleased Undercover Video Provided From 2010 Walt Disney Co. Investigation (FBI Press Release, February 27, 2012)

I dunno about you but using Gordon Gekko in a PSA may get a whole batch of smiles when the actor Michael Douglas launches into his pitch against insider trading but, for me, it sort of trivializes the whole crime. It hits me with about the same weak punch as one of those TV actors playing a doctor on a commercial that admonishes that the paid actor is not a doctor but merely playing one who is trying to get me to take some pill that I don't think I need but the side effects include dizziness, nausea, suicidal thoughts, explosive diarrhea, and a three-hour erection.

Adding insult to injury, the FBI then offers a second video - fairly lousy production values in this one - featuring an individual who appears to be Yonni Sebagg.  Who's Yonni Sebagg you ask?  Oh my, if you have to ask then why isn't Sebagg already a contestant on Donald Trump's Celebrity Apprentice?

In a previous Forbes' "Street Sweeper" article - I think the title sort of gives away my opinion about Mr. Sebagg and the sophistication of his crime:  "A Mickey Mouse Caper Ends With Criminal Sentence"  In my thirty years on Wall Street, few cases have impressed me as having been more comical, more ineptly handled, and hardly indicative of anything remotely approaching a sophisticated scam. I mean, c'mon, Sebagg actually attempted to work an insider trading deal involving the Disney company through emails in which he essentially admits to all the elements of the crime and - amazingly - sent such incriminating correspondence to undercover FBI agents!  Consider these words from the Street Sweeper story:

Not that I'm suggesting that Sebbag wasn't a particularly bright bulb or anything, but, how should I put this - maybe they could have cast him as Dopey in Snow White and the Seven Dwarfs?  I mean, seriously, consider these excerpts from his e-mails to the FBI undercover agents (includes original spelling and punctuation):

  • "First of all, i am not a fed, I have no way to prove it at this point but i am not asking you to disclose your identity not i will disclose mine. It is up to you to determine if this is worth the risk as i did. I work for Disney, that is all i can tell you."
  • "I can deliver 3 to 4 days before release. I will email you the report as soon as i have it and you will wire transfer the money to my account after you get ahold of it. I am asking you to make me an offer based on the capital gains from the trade and the risk i am taking delivering this information to you? Also, i am looking to build a strong business relationship with you for future quarters and information."
  • "I dont think we will get caught if we stay discrete and careful. You can count on my discretion as i am counting on yours…"
  • "… $15k sounds great and $30k even better as i hope you will make a killing from Q2 earnings. I promise i will keep you informed of any unanticipated event, i keep my ears wide open here."

You'd sort of hope that after the Securities and Exchage Commission's comic book approach to insider trading ,that maybe we could stay on point, keep things serious, and not drag out Hollywood stars and the tools of gotcha journalism.  I doubt that Michael Douglas will deter any insider trading.  I doubt that the nearly unintelligible video of Sebagg will accomplish much more than run up the hits on YouTube or Facebook.  I doubt that any brokers at Merrill Lynch, Goldman Sachs, or wherever are going to be deterred from a life of insider-trading crime after seeing these videos.

What the FBI was thinking when they spent taxpayer dollars on this is beyond me but, hey, I'm just the grouchy pundit who writes about this nonsense on Wall Street.  Frankly, where's Efrem Zimbalist, Jr. now that we need him?