On his blog, Cuban promised to try to roll out reports and exposes every day. "Without complete transparency, we will get from our government what we always get when it comes to finances, confusion."
Now, out of the blue, Cuban is facing insider trading charges from a stock sell he made 3 years ago, and wrote about on his blog:
I wanted to reference Mamma.com. I had purchased stock in Mamma.com in hope that it could be an up and coming search engine. I thought I had done some level of due diligence. Talked to the company management. Talked to some employees who worked in sales. Read the SEC Filings. I knew that they had a checkered past and had been linked to stock promoter Irving Kott, and that their law firm still handled some of Kotts business, but the CEO, Chairman, lawyers all said that things were reformed and the company was focused on its business.
Then the company did a PIPE financing. Im not going to discuss the good or bad of PIPE financing other than to say that to me its a huge red flag and I dont want to own stock in companies that use this method of financing. Why? Because I dont like the idea of selling in a private placement, stock for less than the market price, and then to make matters worse, pushing the price lower with the issuance of warrants. So I sold the stock.
If the PIPE financing hadn't been announced when he made the sale, it meets the requirements for insider trading, and it's illegal. He should probably repay the $750,000 that he would have lost had he waited until after the PIPE financing was completed. That doesn't change my opinion that Cuban isbeing targeted for daring to challenge the almighty Treasury. The SEC looked the other way while hundreds of bank executives, with no disernable entrepreneurial skills looted the public for billions, and then the Treasury gives them a reward of trillions in taxpayer money when they blow it all. But if an upstart billionaire dare challenge their authority and ask for a little sunlight, they'll attack him for the most minor infraction. It's like the Puritans and stocks all over again. Maybe we should subject him to a public beating.
As a matter of preference, Mark Cuban annoys me. I think he's a whiner, and I blame his complaining about referees for the Mavericks stealing game 5 from the Rockets in the first round of the playoffs in 2005. (Michael Finley was out of bounds.) Still, I cannot deny the fact that he is a great entrepreneur and savvy investor, and brave for standing up