posted on Jul, 27 2009 @ 10:21 PM
I do not know what the specifics are about the case your talking about.
But here is how you can get rich off of inside information.
Ok, we all know that if you told me "X or Y Stock is going up tomorrow" than I would buy that stock, as my 10$ invested would become 20$
But let us say the stock will crash, so I will put a "Short" on that stock, which means I basically borrow that stock from someone else. If the
stock depreciates in price, than I can get rid of it and gain a profit off of the amount that it depreciated, because I was essentially betting it
would go down.
However if you "short" a stock and it goes up, and you get rid of it, you have to pay the source the price that it increased, and you lose $.
So if you gave me inside information that a stock would go up or down, I could either buy stocks (if it goes up) or short stocks(if it goes down), and
make a massive killing off of it.
If you have billions of dollars, you can turn it into tens of billions easily.