By Caroline Banton
WWR Article Summary (tl;dr) This article takes a look at some money making practices that are not entirely on the “up and up.” While they are all currently legal that doesn’t make them desirable for women in business.
Most successful entrepreneurs say hard work and talent are necessary to make money legally.
However, some individuals and companies operate where the line between legal and illegal business is blurred, all in hopes of getting rich quickly.
Here are five ways to make money that should be outlawed.
TRADING ON ‘NOT PUBLICLY KNOWN’ INFORMATION
Some hedge funds and investors make trades based on information they have obtained through the Freedom of Information Act, according to a 2015 study by researchers from the University of Maryland and the University of Melbourne. The information is not otherwise available to the public unless it is specifically requested for a fee.
Max Galka is a derivatives trader with 10 years of experience. He has developed a website focused on the Freedom of Information Act called FOIA Mapper.
“I use the term ‘not publicly known’ rather than ‘nonpublic’ because technically the information is public, and trading on it is legal,” Galka said. “However, since the information is only obtainable using the Freedom of Information Act, for all intents and purposes, it is nonpublic information.”
For example, Galka said hedge funds that invest in pharmaceutical companies may request information from the Food and Drug Administration about early drug trials before it is publicly disseminated. That gives the hedge funds inside knowledge of whether or not the drug is likely to be approved.
The 2015 study cited above said that fees involved in making a Freedom of Information Act request through the Federal Communications Commission range from a few dollars to several thousand. The fact that resource-rich hedge funds can afford these more expensive costs smacks of “insider trading,” Galka said.