June 22, 2012

Trail of stock deals led to DeCinces insider trading accusation: Link to ex-Oriole teammate Murray remains unclear.

posted by Hugh Janus to baseball at 08:44 AM - 6 comments

I was at that game, June 22, 1979, just barely old enough to know what was happening (or maybe it was my dad and big brother talking about it forever after that sealed it in my memory). The Tigers were beating us 5-3, then Ken Singleton hit a solo homer, Eddie got on base, and DeCinces homered to win the game. Orioles magic happened.

DeCinces was pretty well-regarded as a post-baseball success story, a businessman and philanthropist. All-around great guy.

Insider trading is bad. Anybody who does it knows exactly what they're getting into. This ain't Shoeless Joe. That said, I feel like guys often succumb to a combination of win-at-all-costs mentality and a larger business climate where anything goes and these major crimes seem like minor transgressions or even just a tiny little way to get ahead of the competition. But you just can't break the rules of the game.

Doug DeCinces should have known better. It's a shame that a guy can do that much in his baseball career and then follow it up with a great post-baseball business career, and then cheat, and make headlines for his criminality. If Eddie Murray was involved, well, I'm less surprised. Growing up a Baltimore fan, knowing how much we loved him, and how poorly he treated his fans and the game of baseball while he forced his trade to California, well, we all have mixed feelings about Eddie.

I'm just glad Wild Bill Hagy didn't live to see this. He was disillusioned enough in his time.

posted by Hugh Janus at 09:07 AM on June 22, 2012

I'm not really sure that DeCinces was working on anything more nefarious than a "hot stock tip" from an acquaintance. What does compound his error is that he evidently shared the information with someone else and he kept increasing his holdings. Insider trading goes on daily, but much of the information that is used is available as a matter of public record, although it is hidden in sources that aren't generally looked at by the man on the street. I have done some investing in defense related stocks, and much of what I do is based on information from Aviation Week and Space Technology magazine. Similarly, when I was working, I found that many of our systems used products from a company whose stock had fallen sharply. It was due to some misconduct on the part of the company CEO, and it did nothing to affect the bottom line. I figured that the products were still of good quality, the company was otherwise healthy, and I would buy some stock. My broker thought I was nuts, and a year later he was apologizing.

There seems to have been a pattern on the part of the SEC and various state attorneys general to go after those who have some celebrity and fame. Since civil cases generally have a lower threshold of proof, those who can afford it, guilty or not, will pay the fine to get it behind them. Meanwhile, the SEC agents or the state attorneys involved have another scalp to hang on their belts for future use as political or career capital. I don't say right or wrong, but it does serve to keep the blatant insider trading down to a minimum.

posted by Howard_T at 03:14 PM on June 22, 2012

Inside trading is only legal for Congress.

posted by ic23b at 03:23 PM on June 22, 2012

Inside trading is only legal for Congress.

This statement requires explanation.

posted by Hugh Janus at 03:37 PM on June 22, 2012

Inside trading is only legal for Congress.

This statement requires explanation.

Well, it's not anymore, but it's a fairly recent development.

posted by Etrigan at 05:16 PM on June 22, 2012

Wow, good thing that law was made. We should have caught that problem a long time ago. Thanks for the enlightenment.

posted by Hugh Janus at 09:26 PM on June 22, 2012

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