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Case study reveals insider trading implications in financial markets, suggesting ethical considerations in decision-making.
This case is based on insider trading cases by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) against Martha Patricia (Patty) Bustos and Donald Blakstad. Bustos, a CPA employed as a business analyst for Illumina, Inc., passed confidential, nonpublic information of Illumina’s quarterly financial performance to Blakstad, who traded highly speculative Illumina securities before the company’s quarterly earnings announcement for a profit. In this case study, students explore how fraud theory explains the commission of a financial crime like insider trading. Students also explore the obligations related to keeping information confidential and weigh arguments for and against insider trading to develop ethical reasoning and decision-making skills. Students at accredited midwestern and Southern universities participated in this case assignment. We provide assessment information and implementation suggestions to interested instructors. JEL Classifications: M49.
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Ordyna et al. (2025) studied this question.
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