Hey this is tom and we have a breaking news story developing right this. Second, you absolutely have to hear about this in this video i'll share with you, the story and i'll. Tell you what i think happens next, because this is earth shattering. This is insane so lorcel motors executive sold stock ahead of reporting results and before troubles came to light now.

The reason that this thing is insane is because it seems, according to the wall street journal, that the executives of wall street somehow made things even worse than they were just a day ago. I don't know how they managed to do it, but it seems to be the case so, according to this article, they sold shares in the open market before people knew about the shenanigans and all these issues with steve burns and all of this bad stuff that came Out so what we're going to do in this video is first of all, read the article, understand the circumstance and then i'll, explain to you what i think happens next, because this is about to go ballistic check this out. So, according to the article, several top executives at lord sun motors corporation sold off chunks chunks of stock in the electric truck startup ahead of reporting financial results. According to regulatory filing disclosing the transactions securities, lawyers and accountants, say such trades raise questions about the company's internal controls, especially in light of its recent troubles.

Now i think it's way more than that, if that is factually correct, if people sold off chunks of stock before that information became public, that is actually illegal. It's not about internal controls. It's about violating the law, because in this country we have a law called the securities exchange act of 1934 and in that law we have section 10 called manipulative and deceptive devices and if you scroll down to rule 10 5b-1 trading on the basis of material non-public Information in insider trading cases states, the manipulative and deceptive devices definition which is prohibited by law includes when you trade on the basis of material, non-public information, and i want you to take a look at the definition of on the basis of it - means that it has To be material, non-public information about that security or issuer, if the person making the purchase or sale was aware of the material non-public information when the person made the purchase or sale. The idea here is that if this information was material enough, that any reasonable purchaser or seller of the stock needed to know before making their decision - and they did not have this information, while somebody from the inside of the company had that information and acted upon it - Is a clear violation of rule 10 b again, if this is factually correct, i don't know yet, but according to the wall street journal, if this is in fact what happened, factually rule 10 b was violated means an sec.

Investigation means a doj. Investigation means a ton of lawsuits class action lawsuits, it's about to be barrage of lawsuits and investigations upon lord sound, but let's keep reading the article even more in all five top executives, including the company's president and its former chief financial officer, sold more than eight million Dollars in stock over three days in early february, according to the filings, that's a lot of shares by people from inside the company who knew things are about to hit the shen. If you know what things you understand, but it's not good. It's smelly and it's not pleasant and trust me it's about to get even worse, because what you're about to see right now is a red flag.

If i've seen one one of its executives, chuan jong-woo, who oversees lords and mother's propulsion division sold almost all of his equity 99.3 sold on february, 2nd leaving him with 700 shares. President rich schmidt, a former testlink manufacturing executive who joined the company in 2019, sold 39 percent of invested equity over two days. Three other executives, including lordsville motors former finance chief, who resigned last week, sold small holdings around the same time in february with transactions ranging between roughly 250 000 to 400 000 in value now check this out. Four of the five executives declined to comment through a lordson motors spokesman and check this out.

Securities, lawyers, accountants and analysts say such transactions are highly unusual when you say highly unusual, that's kind of a washed language from what they're really thinking. When a lawyer says highly unusual, you have to know what they mean, particularly because they occurred during a period where many other publicly traded companies bar executive from selling shares. Of course, we wouldn't expect insiders to typically sell at that time in the quarter. Of course, that's just before the freaking filings at best it suggests the company has weak internal controls over trading of their officers, said daniel taylor, an accounting professor, who runs the forensics analyst lab at the university of pennsylvania.

Again, that's code when he says at best it shows poor judgments and poor management. You know what it means and look at this. The company's practices have drawn the attention of the securities and exchange commission, which has issued two subpoenas already now. I think they're gon na have another chat with lordstart about these things as well, and this is really damning.

In my opinion, the early february trades by the five executives all occurred when the stock was trading at 24 per share. It's currently at 10.. So you know they cashed out on the peak. Similarly, they were executed, as news was beginning to spread that a prototype of its first electric truck model caught fire 10 minutes into road test in may now.

This is really important. That sounds like nerd talk, but if you've been watching my alex harp videos, this is the real smoking gun, because here they're, saying lords and motors filings, don't indicate don't indicate that these were pre-scheduled sales. You can pre-schedule. Sales like alex carp is doing with palantir.

I showed you the mechanism these, according to this article, seem to be not pre-scheduled, which is another red flag and look at this wharton's. Mr taylor pointed to the grouping of the stock trades which were executed by multiple executives around the same time. Now, what essentially is saying here: hey, it's, okay, sometimes they need to cash out. They want to buy a house, they want to buy a new car.

I mean they're humans, but when you have five of them at the same time selling so much stock, it's fishy! That's the same thing, i'm saying, but i'm saying that if it's factually true somebody from the sec or the doj needs to give these guys a call and basically call them up for an investigation, because this is like and just to recap what we have here. According to the wall, street journal is five executives who sold a lot of stock in february when the share price was 24. Before the financials came out before the shenanigans came out before burns in the cfo got fired, resigned whatever at 24. When now, the stock are 10 essentially raising the suspicion, according to the wall street journal, that these were trades based on non-publicly, available information by insiders and, what's going to happen, next is you're going to have an sec investigation.

If there's one already, it's going to expand a doj investigation and you have all these class action lawyers who are basically going like this right now, because these guys move fast, i'm assuming they've already filed because they're super fast and of course, before we sign out, we Do have to clarify that these are all allegations being brought up by this wall street journal article. We still don't know if it's true or not. What's the facts or circumstances we're just talking hypothetically and i'm just sharing my opinion, which might be inaccurate, might be completely wrong, might be the ramblings of a madman. You still got ta, do your own research and find it for yourself, as always a huge shout out for the channel members and the patrons you guys are amazing.

We'll see you guys next video, you.