Consultants and insider trading

The WSJ has a story about NY and SEC insider trading investigations of consulting firms. Here's the Law Blog summary. As I said in my first report on this last November, part of the story here is about the link with Reg FD, and how regulation invites arbitrage which begets more regulation and litigation.

As to whether this is really insider trading: the question under current law is whether the consultants are serving as information aggregators, or whether they're essentially paying the info providers to breach their duty to employers, etc.

In any event, get ready for another "scandal."