Did anyone see this story that just came out? Stud first-year out of NYU charged with insider trading. The idiot bought calls on EFI right before their acquisition by Siris Capital. What a fucking moron, only made $100K as well.
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Comments (88)
God damn that was stupid...
Dude did it with his personal account too....
yeah, great risk-reward scenario there. get banned from finance for a lifetime for less than one year's comp.
Is there any chance that he has some great family lawyers and gets off with a slap on the wrist, or is that unprecedented for even the elite in wall st?
He may get off jail time but he's still never working in any reputable finance firm again. They may expunge his record in time, but the internet notoriety will live on.
Also from the article:
Classic NYU "values"where people give each other study materials with incorrect answers to sabotage their grades. Source: My NYU tour guide (!!!), even if only directionally true, a huge red flag and I ran as far and as fast away from that school as possible
Jesus that's fucked
https://www.stern.nyu.edu/programs-admissions/unde...
What is it like being the Student Council President, and what do you hope to accomplish?
LOL, and yikes..how long before this student interview profile mysteriously disappears from Stern's website
The complaint is pure comedy. Did he hope the SEC wouldn't notice that an inactive account happened to buy $30k of calls expiring a few days after the deal announcement??
I'm totally astonished by his sheer idiocy
HUGE haul for the SEC. Congrats everyone, we got him
The trader is an idiot, he had access to non-public information and wasted his time to make off money when other people didn't know.
"It's okay, I'll see you on the other side"
For a profit of less than his first-year salary.
Easy now, he was an investment banker, not a trader ;)
Did you know that JRR Tolkien stands for Jolkien Rolkien Rolkien Tolkien?
isnt s&t paid less base/bonus?
What concert costs 45 cents? 50 Cent feat. Nickelback.
He actually worked in Corporate Banking. Just another of one of Tsai Guy's schemes.
What a dumbass, wow. Didn't even try to hide it.
Poor kid. No one knows what he was thinking, but my guess is that he convinced himself that the information he was trading on wasn't material non public. I don't know how else you explain the fact that he doesn't appear to have even tried to cover his tracks.
He didn't report the account to RBC. This could seem like covering one's tracks if you're a moron
It sounds like he 100% knew what he was doing. Perhaps the student president of Stern and fresh IB analyst job got to his head? Pretty easy to think you're above the law after being on cloud 9 that early in life.
Here's another theory, since we all seem to be okay with armchair psychoanalyzing this guy: With his resume and ambition he believed that he was entitled to something far bigger and better than an analyst role at RBC.* So when the universe didn't deliver him what in his estimation should have been his, he just took it.
*Note: I work with RBC a lot and think it's a great firm populated by very competent and honest bankers.
Not even $100k. That's a short term capital gain, so after taxes he probably netted about $70k. Or would have.
just like my buddy at the gym would say, 'short term gain for long term pain'.
Wouldn't he have passed the SIE by this point? He can't say he didn't know ...
Array
that's pretty dumb, the profit probably less than his salary
+SB xD
fuck me dead
What concert costs 45 cents? 50 Cent feat. Nickelback.
Pure gold Willy
Marky, Ricky, Danny, Terry, Mikey, Davey, Timmy, Tommy, Joey, Robby, Johnny and Brian.
And Willy
Willy? Will!
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
Maybe it's the NYU, but for some reason I envision this kid crying as he confesses in the SEC interrogation room.
Billy Tsai the insider trading guy!
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
Bill Tsai the Inside Guy, Bill! Bill! Bill! Bill!
I'm dead. This is the best.
Array
from a reliable source:
WSO's COO (Chief Operating Orangutan) | My Linkedin
Maybe Because HK airport cancelled all flights
"You know the Fed's listening, n***a what money?" - DJ Khaled
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
Bill Tsai will not be doing any more Schemin'
That's the GOAT Lil Wayne*, on a Khaled track ;)
DJ Khaled could never come up with a line like that
That's Lil Wayne...
Money never sleeps, pal. Just made $98,750 on EFI. It's been wired to you. Play with it. You've done good, but you gotta keep doing good. I've showed you how the game works. Now School's out.
Oh shit wire me that money back I need to make bail
What concert costs 45 cents? 50 Cent feat. Nickelback.
Money never sleeps, pal. Just made
3,074,581 in Taiwan Dollars
https://www.google.com/search?rlz=1C1GCEA_en&ei=Dj... . It's been wired to you. Play with it. You've done good, but you gotta keep doing good. I've showed you how the game works. Now School's out.
Pooring one out for the old boy, Billy Tsai. God speed baby
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
On the bright side, for those of you recruiting - there may now be an open analyst position lol
And you know the specific group too!
Dear Mr. RBC TMT MD,
Through my regular market research of your sector I have found that it is very likely you will need additional junior support...
I've been keeping my eyes peeled for that posting.
Hasn't been posted yet. Not sure if they will post the job opening.
Array
Funny how it's not reported anywhere but he was a corporate banking analyst.
Can corroborate
Corporate M&A
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
Whenever the title is "Corporate and Investment Banking Analyst" you know it's the former and not the latter.
LMAO so true.
Talk about an ego-death
He's taping out
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
Real question is, how did he get caught?
Some intern at the SEC wanted to impress his boss and get a return offer
how did someone spontaneously trading $30,000 worth of options that expired just days after a merger took place get flagged by the SEC???
I don't think it was spontaneous.
The SEC has numerous algorithms and data analytics tools that will flag anything that seems like illicit behavior. It was an Easy catch for them - a banker who hasn't traded much from an account decides to randomly spend 30K one day on something very niche.
He bought a shit load of calls 48 hours before a merger announcement? And FINRA/SEC know he works as a coverage analyst for the investment bank advising on the deal? How he got caught is the easy question to answer. The real mystery is how did this moron traverse through the interview/internship process well enough to be brought on full time.
RBC's interview process at NYU is resume submit->superday.
No one fucking knows why
Its pretty hard to believe that this kid totally spaced on the definition of insider trading, but it is just as hard to believe that a kid from Stern would think he could get away with this...
Maybe he got tricked??????? Nah he dumb.
Array
Bill circa August 11th
Array
Supposedly, he posted bail and is free for now. Ironically, the bail was the same amount of money he got from his insider trading.
Whats the chance he goes stern --> RBC insider trading analyst---> HBS---> Axe capital
Array
More like:
Stern -> RBC (terminated) -> Ricker's Island Capital
"I went in with a bachelors in marijuana and came out with a doctorate in cocaine" - George Jung
Few players recall big pots they have won, strange as it seems, but every player can remember with remarkable accuracy the outstanding tough beats of his career.
What if his personal trading account in which he made $100k was only a bait for the SEC? What if he planned his arrest all along? What if he pocketed $10+M from another hidden account and is now laughing at all of us?
Honestly, I feel that we are missing a big piece of the story - just doesn't seem plausible that he was this dumb.
Array
What's your theory chief ?
Array
Why would he need bait if he had a hidden account all along? Are you seriously suggesting this dude purposely planned his own arrest and invited a firestorm of suspicion by one of the most powerful regulatory agencies in the world because he had another account they somehow wouldn't notice?
Sometimes people really are just this dumb. Look at people like raj rajaratnam and rajat gupta. Some of the biggest names in industry were caught because of their own stupidity.
The SEC is really good at catching insider trading.
My uncle, who was an SEC practice partner at a big NYC law firm told me "There are 2 kinds of insider traders: those that have been caught and those that will be caught."
If you want a career in finance, don't even think about trying it.
Haha. I'm sure you and your uncle are both smart, intelligent people. But this is like the most wrong thing I've ever read. I would wager that the SEC only catches 0.000001% of people that trade on inside information. That is why the DOJ/SEC love to make such a big deal of it when they do catch someone.
If everyone that does this were caught, don't you think we would hear about them more often? Look at target share prices during the weeks leading up to merger announcement. Do you think its merely a coincidence that they generally begin to creep up noticeably? Insider trading is a stupid thing to do because there is hell to pay if you're caught. But let's be honest: this is a low probability (assuming youre not an imbecile like the RBC analyst), high cost proposition.
Big Risk vs Consequence guy... Low Risk, High Consequence.
You make some good points, and we really will never know, but the counterpoint is that the only way to really profit from inside information is with short dated, deeply out of the money options on an underlying stock that's publicly traded.
Could you buy the common? Yeah, you could, but with a typical takeover premium averaging about 30% that's your maximum gain, and the tax man's going to take 12 percentage points. So you're risking ruin and prison for an 18% gain, and only on as much principal as you can invest in that stock.
And because it simply doesn't make sense for people to buy way out of the money options in general, let alone just happen to buy them right before a merger or consequential earnings announcement, it's neither resource intensive nor difficult for the SEC to connect the dots between anyone making such mysteriously profitable trades and the people/firms with inside information.
One of my favorite parts of the story is RBC is in the same building as the SEC
Is it possible this happens a lot more often than we think and a lot more people get away with it than we think?
Only possible explanation is have before reverting to unconscionable stupidity.
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