Buybacks are under attack again as a senator pushes to restrict insider sales after announcements
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Keep Me Logged InCorporate insiders could be barred from selling stock within a certain time period after share buybacks are announced, if one Democratic senator has his way.Sen. Chris Van Hollen of Maryland pointed to evidence from a Securities and Exchange Commission study indicating that share repurchases are benefiting corporate insiders at the expense of long-term investors.As a result, he said he is preparing legislation that would direct the SEC to study the rule on buybacks, with hopes ultimately that a time frame can be established delineating the period during which sales would be prohibited."It could be a long period of time like several years, or maybe analysis would show another period of time that might be appropriate," Van Hollen said during a media call.The senator had asked the SEC to look into stock performance after buyback announcements to determine the impact on individual stocks.
As said here by Jeff Cox