Facebook Employee Terminated Over Insider Trading

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Photo: Tony Avelar/Bloomberg via Getty Images

According to TechCrunch's sources, Michael Brown, Facebook's recently departed corporate-development manager, was fired for purchasing Facebook stock on the secondary markets. The very same secondary markets that went berserk after Goldman Sachs's investment valued the company at $50 billion. Since Facebook is still a private company there's nothing technically illegal about it, although the newly proactive SEC has been looking into trading private shares. Internally, Facebook (no fan of the secondary markets) considers employees' buying stock on them insider trading — a business-development manager probably had more insight than most on the company's potential value. In fact, one of TechCrunch's sources says the trade might have been related to knowledge of Goldman's investment earlier this year. Others claim it was more innocuous and happened before the fact. In either case, the SEC's "Secondary Markets" file just got bigger. Better learn everyone's name before Raj Rajaratnam: The Sequel comes to a congressional hearing near you.

Facebook Terminated Corporate Development Employee Over Insider Trading Scandal [TechCrunch]
Related: Why Mark Zuckerberg Might Not Be Happy That Investors Think Facebook Is Worth $65 Billion