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The Secret World Forum » General Discussion » Former CEO facing Insider Trading Allegations
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9/13/12 4:17:55 AM#21
Originally posted by VirusDancer Read my last post again. You don't seem to understand what he did and why he will be charged and for inside trading!
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9/13/12 4:48:14 AM#22
Originally posted by JeroKane After a planned stepdown from the position of CEO he attempted to sell some of his Funcom stock. The timing of which was meant to avoid any potential issues of impropriety by trying to do so before Funcom would make their next financial announcement. It's difficult to find the actual laws on the matter in Norway, so I'm not sure if the one month thing that was brought up in the thread applies. If so, it looks like he was trying to work within the law. The majority of the stock crashing that you discuss took place after that Aug 10th announcement. Kind of like how the stock had started to drop after the Q1 announcement. It was 23.90 on Apr 16th. 14.65 by May 25th. Down to 5.95 by Jul 24th. Rose to 9.22 on Aug 6th. Aug 10th? Dropped to 3.75... So let's see - bad Q1 - less than stellar release and reviews - bad Q2 report... and you wonder why the stock tanked? Really?
I miss the MMORPG genre. Will a developer ever make one again? Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20% |
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kadepsyson
 Hard Core Member
Joined: 5/15/06
The doctors say his chances are 50/50...but there's only a 10% chance of that. |
9/13/12 4:50:42 AM#23
Originally posted by VirusDancer How do you know this? How do you know he wasn't just using insider information he could easily have had access to? Seriously, do you know? Or are you just guessing based on some dates and your hunch? El Psy Congroo |
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9/13/12 4:51:54 AM#24
Originally posted by VirusDancer you dont need to receive the august 10 financial report in order to know if the game/stock is doing well or not and to be found guilty of insider trading. you just need to have any form of non-public tangible financial report before the trade that gives you the edge in order to be found guilty. he already had access to the pre-purchase/pre-order numbers, which is non-public company information which he used to make the decision to sell his stocks. this is illegal becuse the buyers of the stock did not have access to the preorder numbers before they decided to invest. this guy is definitely going to go to jail becuse this is the very definition of insider trading. as someone said before, he already probably calculated tht the jailtime/fines are worth the crime. |
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9/13/12 5:04:52 AM#25
Originally posted by kadepsyson It was a planned step down. He tried to sell stock. If the month thing is part of it, then he would have tried to do that before the month thing would be an issue. What's the problem exactly with that? How is that guessing? A planned step down. Not a guess. He tried to sell stock. Not a guess. The last one - again, if the month thing exists - then you could say that it's a guess... but the opposite of that would be to suggest that he would not try to do that. That's kind of silly...no? Just a guess... I miss the MMORPG genre. Will a developer ever make one again? Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20% |
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9/13/12 5:05:48 AM#26
Whole case is weird and I am not surprised that officials investigate it. Of course basing only on press and Funcom's information.
Remember this is older article than later 24 article that Escapist articles was based on, so info might be outdated. Norwegian Press E24 Portal : http://ow.ly/dG7lE (shorten google transalte link) inform that CEO sold 380,000 shares in 26th April. In April Funcom's shares were year high price afair. Yet Funcom's Investor Relation's Page does not list that sale. http://www.funcom.com/index.php/investors/P42
That propably mean that either E24 info is wrong or that this trade was not listed. Other trades by Funcom's Employers and managment seem listed with "Mandatory Notification of Trade" headlines in Funcom's Investors Relations page.
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9/13/12 5:06:55 AM#27
Originally posted by VirusDancer He made it look like a long planned step down. Doesn't mean it actually was planned at all or just a last moment decision based on the dissapointing pre-order numbers he and he alone had access to. Fact is, he did the following: 1. Step down as CEO one day before TSW release. 2. Get off the Insider Trade list. 3. Try sell all his 1,5 million stock, but stopped at 650.000 when he was discovered by another share holder. The Funcom stock tanked right after the above became public! That the Funcom stock went down even further after the August 10th report was just a logical after effect of what happened above. |
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9/13/12 5:09:49 AM#28
Originally posted by gessekai332 /cough That is correct. You would not have to look at that to know that. You could look at the numbers - Bloomsberg, Yahoo, etc, etc - they all have that public information out there. You have to prove that he knew what was in the Aug 10th report and how that would obviously affect the price of the stock after it was released. So again - you have to prove. You know, I have to wonder if it's because I'm over here in America - that whole innocent until proven guilty thing. Who am I kidding? Even folks here love to find people guilty before they've even been tried - whether they're found innocent or guilty. I miss the MMORPG genre. Will a developer ever make one again? Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20% |
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kadepsyson
Hard Core Member
Joined: 5/15/06
The doctors say his chances are 50/50...but there's only a 10% chance of that. |
9/13/12 5:13:21 AM#29
Originally posted by VirusDancer I meant, how do you know what the timing of it was meant to do, as you claimed earlier? How do you know the timing of it wasn't instead to use his insider information to save himself from losing a bundle of money? Truth is, you don't. Yeah, it was a planned step down. Yeah, he tried to sell stock. The issue is WHY THEN did he choose to sell stock. Was it because his fortune cookie told him to? Was it because he had insider information? Neither you nor I know the answer to that. So yes until they prove him guilty, then he is innocent. However, I think there is a chance he is guilty. El Psy Congroo |
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9/13/12 5:37:17 AM#30
Originally posted by VirusDancer Before the game launched the stock was doing extremely well. Before they sold the game and before they filed the july report there was no indication that the game would tank. sure the price went down bit a month after but prerelease drops are not reliable as they tend to drop a bit before release date when it would go up again. What he had access to were the preorder sales numbers. he knew that the trend of the stock would plummet after release.
http://www.oslobors.no/ob_eng/markedsaktivitet/stockOverview?exch=ose&menuCtx=1.1.16&newt__ticker=FUNCOM&newt_graph-stock_tab=12months
lets pretend the historical trend of the stock of an mmorpg game is that it rises the highest before the game is launched then it goes down after release and even lower. what would then make sense is to bail out right before the game even launched right? Sure, but he is the CEO OF A COMPANY. you cannot have ceo's be deliberately crashing their company into the ground every time right before they sell their product. this is horrendous for the jobs and the economy and is illegal. |
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9/13/12 5:39:28 AM#31
Originally posted by kadepsyson To be honest, I'd likely lean toward him being guilty. However, I strongly believe in his having to be proven guilty - and - some of the folks in this thread (as well as others) have already convicted him. It's curious, because as part of his stepping down - he talked about the strength of the company and his commitment to being a major shareholder. Funcom has 66.5 million shares. How many does he own? If 1.5m shares were only a small part of his portfolio, then I'd like lean more toward innocence. However, if it was a hefty chunk of his portfolio - given his statement - well, I'd say it goes beyond just insider trading. But still, one can easily look at the financial info available for the company to see that even their 2011 revenue was less than half of their 2008 revenue. From this, one could therefore easily speculate that a lot was riding on TSW. When TSW did not get everybody to drop everything they were doing... well... bam, what happened - obvious. Outside of saying that he had a crystal ball and knew how sales would go - can't really say he knew how they would go - any more than anybody on any random forum could have known. There's a lot of Funcom hate. There's a lot of history of bad launches. The market's crawling with F2P folks. It doesn't take a PhD to figure out what was going to happen... ...perhaps one could say if he read the beta forums, because of the NDA - lol, he had insider info, eh? That would mean anybody that participated in the beta/forums and traded stock would be guilty of insider trading. I miss the MMORPG genre. Will a developer ever make one again? Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20% |
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9/13/12 5:46:32 AM#32
Originally posted by VirusDancer No, but he did have access to the Pre-Order/Prepurchase numbers, which no one else had access to. These numbers are a very important and reliable indicator to see if your game is going to sell well. So it's basically pretty obvious he used these numbers to decide the sale of his stock. Which is ofcourse is blatant Insider info. Stepping down one day before release, removing yourself from the Insider Trade list and then shortly after trying to dump 1,5 million stock doesn't help his case of innocense either. |
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9/13/12 5:51:44 AM#33
Originally posted by VirusDancer When TSW did not get everybody to drop everything they were doing... well... bam, what happened - obvious. Why is it so hard to comprehend that access to preorder sales is extremely important in determining the success at launch and the future of the company? sure we all speculated that it wasnt being well received during beta because of forum talk. however, all that is just speculation and is not reliable because we don't ACTUALLY know how well the game is doing. Forum talk and game press is not reliable financial information that major investors of game compnies care about. Preorder sales is something they would. |
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9/13/12 6:12:58 AM#34
I think it is insane to think that CEO of company don't have any info on sales of biggest company product in 3 years and an product that whole company depend on. Especially that part of sales went through Funcom digital web sales. +
After all game started with certain number of servers. Even though they used technology that allowed to play with friends on other servers (dimensions), single dimension(server) still has certain limit on how much people can play on it. That's why you need multiple dimensons(servers) not one. So company HAS to have some info on sales to be able to set up correct number of servers. Company has to have some info to know if they should initially set up 8 or 30 or 50 servers. |
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9/13/12 5:12:47 PM#35
The thing you're overlooking here is the timeframe. Given what you're saying - people on the list would never be able to buy or sell stock...because they would always have information. Thus the reason why I keep asking if that month thing that was brought up actually exists in Norway. Because again, based on what you're saying - they would never be able to buy or sell stock...since they would always have some form of insider information. Is that the case then? Are people on these lists never able to buy or sell stock?
I miss the MMORPG genre. Will a developer ever make one again? Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20% |
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GeezerGamer
 Advanced Member
Joined: 4/03/12
Who ever said "Familiarity breeds contempt" didn't have an internet connection. |
9/13/12 5:19:23 PM#36
Originally posted by VirusDancer I can't find any fault with this assessment. If the conversation turned "Tit-for-Tat", and I've stopped posting, Consider it your win. |
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9/13/12 5:34:31 PM#37
Man he lies through his teeth ,which means he is 100% guilty. The timing was not furtuitous lol,it was OBVIOUS.He claims he knew NOTHING of the games potential sales,in his position he knew EVERYTHING.They know of pre sales/orders that alone gives a strong indication.Also the biggest marketing firm that used to post the numbers no longer does to the public but does to the developers. To do this one day prior is just ridiculous,he coudl have went for one week or 2 months but the timing proves he was waiting until the stock hit a high from pre hype then wanted to know if preorders shoed the game had any interest.he waited until the last minute.Furthermore just because he put himself in a position to be able to sell,he waited not one day to actually put his stocks up,so he was planning that from the first minute. Of course he would offer to stay on in an advisory role,he gets paid a salary and he probably figured he wouldn't get caught. IMO it shoudl be a no brainer,he should end up losing all his money back to the stockholders and jail time. http://www.youtube.com/user/Napolianboo#p/u/15/rCYLLQCNc1w |
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9/13/12 5:36:28 PM#38
Originally posted by JeroKane
Why is it that everytime someone in the MMO industry lose a job, posters on these forums makes it sound sooooo much worse than for anyone else? I've lost my job twice due to bankrupsy, and it sure as hell didn't DESTROY my life, and my family is just as fine now as before. I don't know if you actually mean this or not. If you do, you really need to get out of your basement and face reality every now and then. Especially since you're Norwegian, you should know how retarded this statement is, else you don't know shit about the country we live in. |
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9/13/12 5:49:05 PM#39
Originally posted by VirusDancer Noone from Funcom's had that kind of information like in case of TSW release. Because never in company history it was depending so much on one game release and never Funcom's failed it's predictions so much. AoC failed but it's sales were strong and Funcom's was in real good financial situation after it's release. Afair it had over 50 mln $ in cash and very little debt.
So no that kind of inside information like TSW does not happen often.
Besides It is not about him trading shares. It is about him doing it and not providing info about it to investors. Norway portal write that he sold first biggest batch of shares still as CEO in April and have not shared this with investors. Funcom investor relation page has no info about this trade. Of course E24 can be wrong.
For those shares that he started to sell almost immedietaly almost he stepped down as CEO and after there were first strong signs that TSW failed to meet it's sales plan. No idea if that's illegal in Norwey - I would guess it is but I don't know. Surely it is horrible ethically and morally imho. |
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9/13/12 5:52:42 PM#40
Originally posted by gessekai332
I would just like to clarify that the stock was not "doing well" before launch. Please look at this 6 month graph, and notice the ~$10 dollar decline PRIOR to the game's launch.
"Judge a man by his questions rather than by his answers.” - Voltaire |
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