Supreme Court Rejects Newman Requirement of “Pecuniary or Similarly Valuable” Personal Benefit for Insider Trading Liability for Tipping Family and Friends (continued trom page 1) 8 ¥ pping z as a personal benefit necessary to be held liable In Salman, an investment banker at Citigroup inside information to a close family member to for insider trading.? Sa/man will almost certainly tipped his brother about certain pending health- satisfy the “personal benefit” requirement of tip- embolden the SEC and federal prosecutors to care mergers involving Citigroup clients. The per-tippee insider trading liability. The government bring more insider trading cases, because it is brother traded on that information for a profit, did not identify any money or other valuable quid much easier for the government to prove a “gift” and also tipped his brother-in-law, Mr. Salman, pro quo paid for the tip. Salman was convicted at to a “friend” than to prove a “pecuniary” or similar who also traded for a profit. At trial, the govern- trial, and his conviction was upheld by the Court quid pro quo. ment relied solely on the tippers giving a gift of of Appeals for the Ninth Circuit. (continued on page 3) Client Alert: Status of the New DOL Fiduciary Rule (continued from page 1) a better commission for the adviser. The Obama a new “economic and legal analysis” to deter- FAQs administration found that conflicted advice cost mine whether the Rule is likely to harm inves- https://www.dol.gov/sites/default/files/ebsa/ savers about $17 billion a year based on a 2015 tors, disrupt the industry or cause an increase about-ebsa/our-activities/resource-center/ report. To be clear, the Rule applies only to retire- in litigation and the price of advice. If the DOL faqs/col-rules-and-exemptions-part-2.pdf ment accounts like 401(k)s and individual retire- concludes that the regulation does hurt inves- https://www.dol.gov/sites/default/files/ebsa/ ment accounts (“IRAs”), not to regular taxable —_—tors or fi