At least 436 employees at the Department of Health and Human Services had access to private and sensitive information suspected in an insider trader investigation lead by the Securities and Exchange Commission. As the Washington Post reports:
The surge of trading in Humana’s and other private health insurers’ stock before the April 1 announcement already has prompted the Justice Department and the Securities and Exchange Commission to investigate whether Wall Street investors had advance access to inside information about the then-confidential Medicare funding plan. Sen. Charles E. Grassley (R., Iowa) told the Washington Post late last week that his office reviewed the e-mail records of employees at the Department of Health and Human Services and found that 436 of them had early access to the Medicare decision as much as two weeks before it was made public.
The number of federal employees with advance knowledge is likely higher, according to the Post.
The investigation started when Height Securities alerted its clients on April 1 that funding would be increased to Medicare at least 18 minutes before the market closed and before the government made an announcement.
Keith Hall, a former commissioner at the Bureau of Labor Statistics, claimed that confidentiality is very serious among statistical agencies that handle sensitive information, but other agencies don’t have the same consequences.
"There are plenty of people at [Centers for Medicare and Medicaid Services] who, wanting to be cooperative and friendly, may have given out information without realizing it would benefit one investor versus another," former Director of Medicare Thomas Scully told the Post.