House Passes Bill to Curb Potential Abuses of Rule 10b5-1 Trading Plans

The U.S. House of Representatives passed a bipartisan bill that would require the Securities and Exchange Commission (SEC) to determine whether to adopt specified amendments to the rules governing 10b5-1 trading plans.

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Background SEC Rule 10b-5 prohibits securities fraud, including insider trading through the purchase or sale of securities on the basis of material non-public information. SEC Rule 10b5-1, which was adopted in 2000, allows insiders to transact in their company’s securities…