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This week an action was filed by the SEC against Toby Scammell.  The filing centers on the acquisition of Marvel Entertainment, Inc. by the Walt Disney Company, which was announced on August 31, 2009. Prior to the acquisition, Mr. Scammell lived with his girlfriend in Los Angeles. During that period she was an extern at Disney assigned to work on the Marvel acquisition. She worked long hours during the summer of 2009 and periodically discussed the project in general terms with Mr. Scammel but did not reveal the name of the company. Frequently she worked from home where there were papers about the deal. She was aware of the announcement date for the deal and the $50 price. Mr. Scammel had access to her papers and Blackberry. During one conversation, she suggested that the project would be done shortly after Labor Day. Scammel purchased call options on Marvel weeks before the deal and sold them for a 3,000 percent return.


1. Why was the action filed against Toby and not his girlfriend? Discuss your answer in terms of the fraud triangle.

2.  What were some of the red flags used by the SEC and mentioned in the article to pursue this action?

3.  What is the name for this type of fraud? What is the potential punishment for this fraud?


Staff. (2011). Fund manager charged as Marvel insider trader, Thomson Reuters News & Insight, Aug 11 (Retrievable online at