ROCHESTER, N.Y. (WROC) — A report from a federal investigative group says it found no wrongdoing of insider trading in the process that created a multi-million dollar federal loan for Eastman Kodak. This investigation comes after trading volume rose significantly for the company this summer – just a day before their new vision to manufacture pharmaceutical material was formally announced.
According to chairman for Brighton Securities George Conboy, Kodak shares skyrocketed Sunday night and Monday throughout the day, following the announcement. But, the ordeal is far from over. “Anybody buying the stock today, it’s complete speculation. And if you are buying a stock just because it’s going up, that’s the wrong reason to buy it.”
While two out of three investigations have wrapped up – the loan for Kodak’s vision to start a new life is still on the table.
“Kodak’s investigation has been wrapped up, and now the defense agency’s investigation has been wrapped up as well, both found no wrongdoing with internal processes at each location. One of the investigations remains, Securities and Exchange Commission, they tend to be slow.
And there’s no telling just when it will wrap up. Until then, Conboy suggests – there may be another reason the deal is hitting a snag.
“It may be dead because of politics. It was a Trump administration initiative, with new administration coming in, do they pull the rug out? If you look at the track record for what happened at that press conference when they announced it, there wasn’t a single local politician there. The mayor, Morelle didn’t show, the governor sent a pre-recorded video clip, Schumer wasn’t there, where were they all?” he said.
Conboy said the biggest call for investigation in Congress was Elizabeth Warren, an opponent to Trump administration. “I don’t know how much politics had to do with it, but at the time, seems like a lot of political overtones, both on ‘lets go with deal’ or ‘hey let’s put breaks on deal’ both sides looks like it was a proxy fight playing itself out, with this company as kind of a victim in between,” said Conboy.
As for insider trading – Conboy says it’s likely the SEC will also find no wrongdoing, and the investment of stock on the CEO’s part was merely a matter of scheduling.
“Records show the Kodak CEO bought stock on the same 90-day schedule for a long time prior to announcement. That’s common,” he said. He mentioned the release of the news a day before the formal press conference could very well be a matter of clumsiness, and forgetting to embargo.
Conboy says the last investigation we’re waiting on from the SEC could take weeks or months.
No one from the Biden administration has made a comment on the deal yet, and Kodak said on Monday they were not in a position to comment on the deal.