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Another argument advanced by critics is that strict insider trading regulation may have a chilling effect on the work of securities analysts, prohibiting "sensible dialogue" between company officials and analysts.12 The empirical evidence is to the contrary. Thousands of analysts ply their important trade in the United States diligently, effectively and within the law. In its history, the Commission has brought only two insider trading cases even touching on the company-analyst exchange of information – one where the Commission alleged that the chief executive officer of a corporation, in breach of his duty to the company, tipped several securities analysts in advance of earnings announcements in order to protect his reputation and continued earnings power;13 the other, where the Commission alleged that an analyst traded based on material non-public information misappropriated from his employer.14
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