In a new interview, Dallas Mavericks owner Mark Cuban said the Securities and Exchange Commission (SEC) is “useless” and brings “ridiculous” lawsuits against investors.
The billionaire “Shark Tank” investor fought his own SEC lawsuit accusing him of insider trading for five years before a jury finally cleared him in 2013. Since then, he has spoken out against the SEC and tactics he has previously called bullying and “unmoored from governing law and precedent.”
“Had the SEC really wanted to make the markets safer, they would publish bright line guidelines,” Cuban said in the new interview. “For instance, there's no specific law on insider trading. There are only legal precedents that have been set as a result of various cases that the SEC has brought ... If you're just an investor, you have no idea.”
Cuban made his latest comments on the SEC to Editor-in-Chief Andy Serwer in a conversation that aired on Yahoo Finance on Thursday, May 23, in an episode of “Influencers with Andy Serwer,” a weekly interview series with leaders in business, politics, and entertainment.
In his conversation with Serwer, Cuban cited an example of the SEC’s “stupidity.”
“The guy was going to work. It was a railroad company in Illinois… And every day he'd go to work. One day in the parking lot that everybody shared, there was a bunch limos. And then another day there was a bunch of limos. Then another day, the guy guessed, literally guessed, that the company was being sold.”
“And he bought stock,” continued Cuban. “The SEC sued him. Now, the SEC lost, but that's just some of the ridiculous stuff that they do.”
Cuban didn’t specify the name of that case. However, he could have been referring to a case brought against a pair of railroad yard workers back in 2010 who suspected their company was being acquired after they saw people in business clothes touring the rail yard. The SEC did in fact lose that case.
The issues with the SEC have been deeply personal for Cuban, who was accused of selling his shares in an internet search company called Mamma.com after finding out about a private placement that would have diluted his stake in the company.
“When I was battling the SEC, it took everything I had not to just say, ‘F you,’ every minute of every day, because it was ridiculous,” Cuban said. “Some of the due diligence that we were able to do, the things that they said about me… the ridiculous approach they took… when you have that coming at you, it's hard.”
Andy Serwer is editor-in-chief of Yahoo Finance.
Aarthi is a writer for Yahoo Finance. Follow her on Twitter @aarthiswami.