Insider Printing?

11 Mar

Who do you think has the most complete, and confidential information about a company- the Chief Operating Officer? The General Counsel? Clearly, both positions are more informed about what’s going on within a company than 99% of employees, but what about someone a little less under the radar- say, the mail guy?

Very few people can clearly see who is communicating with whom within a large company as clearly as a mailroom employee. Think about it, an intra-office mail delivery clerk walks around and sees what’s going on in all units of the business, every day. In addition to seeing the lines of communication, I’m sure there are countless instances of mail clerks overhearing very sensitive conversations. In short, if I were looking to put a mole into a company, I would start where many hardworking CEO’s began their careers– in the mail room.

Clearly this is not a legal operation, but as a thought experiment, I want to see where else this practice could be applied.  The mail room is a good place to start if you are looking for insider information for one specific company, but how could you position yourself to intercept information about everyone else in the S&P 500? Fed-Ex.

Everyday, thousands of consultants and lawyers jet around the country, providing strategic recommendations, evaluating the health of business lines, and pitching innovative business ideas to the biggest companies. Most of those consultants rely on print shops to print, collate, cut, bind, and whatever else they do to paper, in order to have a physical deliverable handed to the client.

What kind of information is in those documents? Financial projections, M&A advice, valuations, etc. In short, VERY CONFIDENTIAL information. That means that every week, thousands of employees across the country have their hands on potentially market-moving information. I think it suffices to say that a large majority of these employees earn hourly wages, probably far below those of the consultants making the corporate presentations, so there is a very interesting arbitrage opportunity for someone with a penchant for risk that vastly outweighs his or her code of ethics.

Just imagine right this moment, what huge plays are being made by the likes of Apple,  American Express, Google, PRIVATE EQUITY FUNDS (you have to imagine they have some very valuable print jobs queued up), or anyone really for that matter either trades publicly or wouldn’t want to leak any sensitive information.

Again, I have to reiterate that this is not a legal activity that I or the laws of the United States of America condone, but it is a pretty clever way for a very stupid person (that is, stupid enough to take such a risk) to make a lot of money. This is a blog about good ol’ fashioned entrepreneurism, after all, and not all investors are angels.

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One Response to “Insider Printing?”

  1. Joe March 11, 2011 at 6:42 pm #

    What about kinkos? Electronically copy power point presentations etc???

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