Erkan Izgi View On What Constitutes “Nonpublic” Information

copyright QuadstarCommunications

Gersan Elektrik Ticaret ve Sanayi AS (GEREL.IS) (BIST:GEREL)

WASHINGTON, DC, USA, August 1, 2023/ — “Nonpublic” Information is “nonpublic” until it has been disseminated or is available to the marketplace in general (as opposed to a select group of “acquaintances.” investors).

Mr. Erkan Izgi stated, “Company members and or a candidate that disclose information on a limited basis, for example to ‘acquaintances,’ are clear insider-trading violations and anyone who does so should be prosecuted to the maximum with no excuses.”

He went on to add” a company report, even if it contains false profits posted on the internet and distributed widely through a press release or accompanied by a filing has been effectively disseminated to the marketplace. The member or candidate should abide by proper actions to achieve public dissemination of pertinent information before its benefit and candidates must have a reasonable expectation that people have received the information before it can be considered public and such can be publicly challenged.”

Selective disclosure issues often arise when a corporate insider provides material information or uses such for personal gain before that information is released to the public.

Analysts must know that a disclosure made to a room full of analysts does not necessarily make the disclosed information “public.”

Analysts should also be alert to the possibility that they are selectively receiving material nonpublic information when a company provides guidance or interpretation of such publicly available information as misrepresented financial statements or notifications before regulatory filings.

Mr. Erkan conveys a humorous story by exemplifying a member, candidate and or owner of a publicly owned gas station business that decides to accept a tender offer and sets off to double up early in buying the family a new gas station, properties at full price. He describes this decision to his friend running the tax office, who takes in on the run and also conveys it to his daughter (who currently owns no company stock); she tells her groom, and then he tells his driver and former stockbroker, who now executes for him, by immediately buying stock for himself. The knowledge concerning the pending deal is both material and nonpublic. Thus such an example has transgressed the inside information to his proxy. Like an infection, the tax man, groom, lawyer, and broker have also violated the standard by buying the shares based on material nonpublic information.

Asia Kent
Eurasia-World News
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