I just read a great article about these two people that worked at Capital One credit cards. Their job was to monitor for credit card fraud. Being enterprising and innovative what these two did was write queries to see how many people bought Chipotle, and you guessed it, they did some market analysis and made a killing in stocks. Looks like they did this for a few different companies. Needless to say they were charged with inside trading. I can't help but wonder though, had they been able to work instead on just market data would they have been as successful in seeing trends? I doubt seriously this is the last we will hear about this kind of data mining. There are so many industries where things like this could happen. Now had this been the company owners instead of employees would it have been misappropriation?
That's an incredible story, although it's definitely illegal for obvious reasons. There's no way they would have been as successful using publicly available data, unless they made some pretty darn good guesses. I wish I had access to that sort of data, and it looks like they definitely did their homework. I'd rather reward them for putting in that kind of effort, but I'm not the least bit surprised that they were charged with a form of insider trading.
That was a good read. I agree that it is not a clear cut inside trading infraction, but it was done using data not available to the public. None the less, I give them kudos for their hard work and effort, and intelligence. I don't think it is purely inside trading because there was still a lot of speculation on their part. Anyone can walk by a restaurant chain and look to see how "busy" it is, and then speculate that the stock is under valued.