Question: Robert Willis was a psychiatrist. During a therapy session, one of his longtime patients, Mrs. Johnson, explained that her husband, the CEO of Shearson Loeb,

Robert Willis was a psychiatrist. During a therapy session, one of his longtime patients, Mrs. Johnson, explained that her husband, the CEO of Shearson Loeb, would soon become BankAmerica's CEO. This information was not available to the public at this time. Mr. Johnson was a well-known, most successful manager who always led corporations to highly profitable years. Clearly, BankAmerica stood to greatly benefit from Mr. Johnson's great leadership skills. On the basis of that information, Willis bought BankAmerica's stock and made a profit of $28,000. As a result, Willis was criminally charged with securities fraud for trading on inside information. 1/ Under the federal insider trading laws, could Willis be convicted? Explain. 2/ Assume that Willis' receptionist accidently found Willis' handwritten notes about this investment information on his desk. Not knowing Mrs. Johnson and without any investment experience, the receptionist nevertheless decided to buy BankAmerica's shares of stock, making $55,000 in profits. Clearly the receptionist had misused Wills' handwritten notes, but did the receptionist violate the insider trading laws? Be specific

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