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Corel

Cowpland Reacts to Insider Trader Charges 32

Posted by CmdrTaco from the stuff-to-read dept.
adraken writes "Wired is reporting on the recent charges filed against Corel CEO, Michael Cowpland. Cowpland replied to the charges, "Obviously it's upsetting. And that's why I've been putting a lot of energy into proving my side is right in this situation. But, nevertheless, it's not distracting because I'm convinced there's nothing been done that's wrong -- and that will show up." The article goes into an indepth look at Cowpland and his life. "
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Cowpland Reacts to Insider Trader Charges More

Cowpland Reacts to Insider Trader Charges

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  • Since this is a big ol' Canadian brouhaha, try the CBC for more details:

    http://www.cbcnews.cbc .ca/news/cp/business/991014/b101461.html [cbcnews.cbc.ca]

    Here's some quotes that provide a much better factual detail of what he did:

    After Corel's results were released in September 1997, the average closing price of Corel stock over the next month was $5.57 - almost $3 below the $8.47 average price Cowpland had received when he sold in August.

    This suggests Cowpland made $7 million more than he would have by selling when he did, rather than after the results were released.

    The stock sale represented almost one-third of Cowpland's 7.9 million shares he owned in the company.

  • "there's nothing done that's wrong" said he, which is an interesting way of phrasing it. Not "I didn't do it" but "it wasn't wrong." so this is probably going to be a letter-of-the-law defense.
    Whether that's good or bad is for people more qualified than I to say.

    Oh, yeah: one thing. This wife is "[k]nown for her dyed blonde locks and revealing outfits". How many people out there are/know a female who's known for her hair colour?
  • > If guilty, he faces up to two years in jail, a
    > fine of up to C$1 million (US$1.48 million),
    > and also possible payment of three times any
    > profit made.

    I'd like to point out that C$1 million is more like US$681 thousand (US$ > C$).

  • Doesn't that seem a bit absurd, to make him pay 3 times any profit made? Does he really own this much money? Some of these monetary fines both in the US and in Canada can seem completely ridiculous. Can the guilty parties even actually afford it?

  • Not much to worry about, too bad (Score:3)

    by chip guy ( 87962 ) on Monday October 18, 1999 @05:41AM (#1605400)
    He is being careful with what he says alright. But he probably has nothing to worry about. The securities laws in Canada are a sick joke and the regulatory agencies are lapdogs to the securities industry. Unless the regulators execute a search warrant and find a to-do list in your hand writing that has "3) do insider trading today" checked off you are probably ok. :-O

    In a famous incident, a mining company exec "A" was buddy of a former premier of British Columbia we will refer to "B". A deal for an American company to acquire this mining concern falls through and A places a phone call to B. B hangs up the phone, calls his broker and dumps all his holdings in A's company. Within hours the failed acquisition becomes public and the value of A's company's stock falls precipitously. "B" manages to avoid losses on the order of a million bucks. Both the regulatory agencies in BC and Ontario were unable to convict either A or B on insider trading! B claims that the phone call from A was just to discuss weather, sports etc. I think there was an just recently an out of court settlement to end the investigation.

    It may sound weird to an American who is used to being careful with securities regulations, but I actually envy you with your SEC. They might sometimes act like Nazis but at least a**holes like Mike Cowpland would have to be a lot less brazen when they hose (or appear to hose) their investors.
  • Nothing in the Wired article discussing the merits of the prosecution case (great journalism, Wired). I recall a couple of comments from the previous slashdot story that discussed the deatils of the case. Summary:

    1. His alleged crime was to sell stock before announcing worse than expected profits, a case of insider dealing.

    2. No-one was sure whether or not he announced his sale, and what period of notice was given.

    3. The stock has risen 25% since the disputed sale.

    Does anyone have any new information to add to the above? The above doesn't look exactly damning...

  • A small price to pay to live in a free
    country.
  • Yes, I agree, the securities laws in Canada are a joke. In this case though, the joke may be on Cowpland, since Corel is also traded on the NASDAQ (CORL) [stockwatch.com], and therefore subject to SEC regulations.

    Beyond that though, we could fill up a complete /. site with the horrible abuses committed on Canadian exchanges. If you think the Toronto exhange (where Corel trades) is bad, take a look at the Alberta, or the *shudder* Vancouver exchanges.
  • Even though I like corel, I hope the truth comes out here - if Bob Young (or anyone else) was accurately accused of insider trading, I would not stand behind them, because I have no respect for people who do that kind of thing. However, if he just had a "premonition" and sold some stock, I'm ok with that - why take a loss if you can avoid it? As long as it's legal, go ahead.
  • "there's nothing done that's wrong" said he, which is an interesting way of phrasing it.
    Not sure I'd read much into that. He tortures syntax regularly, even in the most innocuous situations.

    disclaimer: i'm a CORL shareholder.

  • Nothing in the Wired article discussing the merits of the prosecution case (great journalism, Wired)
    Just to clarify, this is a Reuters story, not original reporting by Wired. (Minor peeve of mine is that /. frequently credits reports to the places where they're posted, not the organization that actually originates it.)
  • I would imagine that it's the jail time (less time served) that would actually be the "punishment". Even in the smallest of tech companies these days, the guys in charge take home > $150,000. Now, multiply that by the hundreds of millions that a large company makes in a year. Sure, a million dollars (in any country) is a lot of money, but when you make more than that in a year, it boils down to a minor annoyance in your style of living.
  • I believe he was also charged with making false statements to investigators.
  • Bet she scratches his itch - meow!
  • Last time I read about this, Cowpland was stating that the problem stems two years back. Why is this recent?
  • I had a look back at the older story, and was puzzled by a few things I saw:

    1. The prosecutors allege he made a profit of CAN$7 million. Why is the fine only CAN$1 million?

    2. The CBC story says that it will not affect his position in the company, which strikes me as odd if he could spend up to two years in jail...

    3. An AC made a remark to the effect that Cowpland still expected to make his sales figures at the time of the stock sale, which suggests that he did not sell his stock to avoid an anticipated capital loss.


    If the third remark is true, then the only serious allegation is that he lied to the investigators. I couldn't figure out what misrepresentation he was expected to have made from the allegations. Any enlightenment?

  • Re: Strange... (Score:1)

    by Anonymous Coward

    It seems to be working now (12:46PMEDT, Oct.18, 1999).

    Has anyone noticed that Anonymous Coward posts are not getting moderated? They start at level0, as stated in the FAQ [slashdot.org], but they just stay there. This has been happening a lot lately. Some really insightful and interesting AC posts are just being left at level zero. What's up?

    Back to the topic...

    I heard on Ottawa radio this morning that a lot of possible insider trading has been going unchecked in Ontario. They mentioned that often, just before a friendly merger, the two merging companies' stock prices go up before the merger is publicly announced. The Ontario Securities Commission has, naturally, decided to start cracking down more forcefully.

    As for Mr. Cowpland, I'm not sure what his motives really were in selling that stock just before the loss announcement, but his wording casts a bit of suspicion -- even possibly hubris ("I'm convinced there's nothing been done that's wrong"). The Ottawa Citizen [ottawacitizen.com] (a local newspaper) has probably made up its mind. The stories they've printed that I've seen have shown pictures of Cowpland "driving away in his Porsche911," and generally play up his richness. Ask yourself why someone as rich as him would need to do insider trading to "pay off his debts."

    On the other hand, perhaps he did need to pay off his debts-- for his car, his mansion, his wifes' sexy dresses (and dog hair dye) and any other friviolous things he bought.

    For any of you that find Marlen Cowpland (Dr. Cowpland's wife) "interesting," there's a picture somewhere of her at a party in one of those dresses with Dr. Cowpland grabbing her butt. I'm not kidding! This is true! The picture is not obscene, just funny.

  • I had a look back at the older story, and was puzzled by a few things I saw:

    1. The prosecutors allege he made a profit of CAN$7 million. Why is the fine only CAN$1 million?

    2. The CBC story says that it will not affect his position in the company, which strikes me as odd if he could spend up to two years in jail...

    3. An AC made a remark to the effect that Cowpland still expected to make his sales figures at the time of the stock sale, which suggests that he did not sell his stock to avoid an anticipated capital loss.


    If the third remark is true, then the only serious allegation is that he lied to the investigators. I couldn't figure out what misrepresentation he was expected to have made from the allegations. Any enlightenment?

  • Wow. This was a boring article. Nearly half of it was about Marlen.
    -russ
  • It's $1M CDN, plus up to 3 times the profit. Plus 2 yrs in jail.

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