TheCorporateCounsel.net

Earlier this month, Dave blogged about the perils of companies voluntarily assuming responsibility for their insiders’ SEC reporting obligations & offered some suggestions on controls and procedures that companies should consider implementing to mitigate those risks.  WilmerHale’s Greg Wiessner has a suggestion to add to Dave’s list:

Regarding Dave’s comment about further advice for managing Section 16 reporting, the one item I relied on while in-house is creating a strong, two-way relationship with any captive broker team. By establishing a trusting, close communication process, you will know when an insider is considering a transaction. This helped the company (and me!) so that I could head-off a forgetful insider or one who is getting too close to the line of trading while in possession of MNPI. While my experience is that brokers have automated reporting, I went beyond that system by asking the person executing the trades to include me early.

This is good advice – and reminds me of something similar that my former colleagues & I also found to be helpful. Most corporate bigwigs have experienced and smart assistants, and many rely on them to provide order to a large portion of their lives. If you’re the poor soul who is stuck with the task of beneficial ownership reporting compliance, it’s very helpful to ingratiate yourself to these folks and let them know that you need to be contacted before the insider purchases, sells or otherwise transfers any shares.

– John Jenkins