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SEC Charges Cuban with Insider Tradiing

How much money does a multi-billionaire need? Apparently, at least another $750,000. That's the amount the Securities & Exchange Commission believes Dallas Mavericks owner Mark Cuban avoiding losing by dumping all of his Mamma.com stock one day before the company announced it had concluded a successful private offering of its stock. The day after Cuban sold his entire 6% interest in the company, the share offering was announced and the price of the company's stock dropped more than 10%.

The SEC has filed a civil action charging Cuban with insider trading. You can see a copy of the complaint here. The good news for Cuban is that it is a civil action so, unlike Martha Stewart, if he loses he won't be facing jail time. The bad news, aside from the fines and penalties involved should he lose, is that the filing of this action no doubt seals his fate with respect to the Chicago Cubs. No matter how much higher his bid may be, with this complaint hanging over his head, Commissioner Bud has all the ammunition he needs to torpedo Cuban's bid.

Full post as published by Sports Biz on November 17, 2008 (boomark / email).