Violation of III(B) - Fair Dealing?

Here’s an ethical question…

Suppose a sell-side research analyst visits with a company that he covers on Monday. Then, on Tuesday, he attends the morning internal sales/trading meeting at his firm and announces his findings, but isn’t changing EPS estimates or stock rating. Then, later on Tuesday, he e-mails a personalized e-mail with his findings to select top clients. Then, on Friday, he issues a research note with his findings to all clients.

This is a clear violation of III(B) - Fair Dealing, right? Or does the analyst’s “announcement” in the internal sales/trading meeting (as the institutional sales force can then go and call clients with the information) constitute sufficient dissemination of his opinion?


Violatiion for sure. The analyst has to desseminate to all clients and then can call his top clients if he wants. Discussing with the sales traders also sounds sketch, as they can act on that info. If it’s not material then I guess it’s okay.