Of Loose Lips and Stock Tips

Victory in the Winans case will help in snaring insider traders

The dramatic crackdown against insider trading has been haunted by a strange irony: no specific statute outlaws or even defines the crime. Using the broad | antifraud provisions of federal law, prosecutors have been expanding the reach of prohibitions against insider trading on a case-by-case basis. Over the past few years they have won decisions in numerous courts, but none of those precedents have been explicitly endorsed by the U.S. Supreme Court.

Last week the court came close, upholding the mail- and wire-fraud conviction of R. Foster Winans, a former Wall Street Journal columnist who was paid by stockbrokers to leak...

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