J C Cowdin, a director of Curtis Wright Co , phoned Robert Gintel, a partner of Cady, Roberts Co , a stock brokerage house, and advised him that Curtis Wright 's quarterly dividend had been cut Gintel immediately entered orders selling Curtis Wright shares for his customers ' accounts The stock was...

Insider trading Judgment against Gintel and Cady Roberts Co Cowdin as a directo ...

J. C. Cowdin, a director of Curtis-Wright Co., phoned Robert Gintel, a partner of Cady, Roberts &

Question:

J. C. Cowdin, a director of Curtis-Wright Co., phoned Robert Gintel, a partner of Cady, Roberts & Co., a stock brokerage house, and advised him that Curtis-Wright's quarterly had been cut. Gintel immediately entered orders selling Curtis-Wright shares for his customers' accounts. The stock was selling at over $40 a share when the orders were executed but fell to $30 soon after the cut was announced to the public. The SEC contended that the firm, Cady, Roberts & Co., and Gintel violated section 10(b) of the 1934 act, Rule 10b 5, and section 17(a) of the 1933 act. Gintel and Cady, Roberts & Co. disagreed. Decide. [In re Cady, Roberts & Co., 40 SEC 907]

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...