Insider Trading and Off-Channel Communications in the Age of Remote and Hybrid Work Environments
Though many, if not most, of the measures implemented to address the COVID pandemic have since been rolled back, the transition from fully in-person to remote and hybrid work environments appears to be here to stay. While these arrangements provide employees with additional convenience and flexibility, they also come with risks for companies that are […]
Phara Guberman and Kenneth Breen are Partners and Kaitlyn O’Malley is an Associate at Cadwalader, Wickersham & Taft LLP. This post is based on their Cadwalader memorandum.
Though many, if not most, of the measures implemented to address the COVID pandemic have since been rolled back, the transition from fully in-person to remote and hybrid work environments appears to be here to stay. While these arrangements provide employees with additional convenience and flexibility, they also come with risks for companies that are subject to the recordkeeping provisions of federal securities laws and whose employees encounter material nonpublic information (“MNPI”) in the course of their work. Over the past few years, the U.S. Securities and Exchange Commission (“SEC”) has been increasingly aggressive in bringing charges for violations of federal securities laws resulting, at least in part, from the risks associated with remote work environments.
