Credit Default Swaps: First SEC Investigation Into Complex Securities

06/06/2009 05:12 am ET | Updated May 25, 2011

Insider trading has a new face. Credit default swaps, long one of the least understood and least regulated sets of financial instruments can be used for insider trading in a similar manner to stocks, but the government has never brought a case about illegally gotten CDS profits. That changed yesterday and it could be the beginning of a new wave of investigations by the SEC.

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