Business law please help?

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cameleo

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Jose Contreras is president of a marine research company, Waves, Inc. On April 1, the research director of Waves tells Jose they've come up with "Oxygum," a means of breathing underwater by chewing a special kind of gum. Jose knows a great product when he hears it. He delays announcing the invention to the public, so he can buy up all the Waves stock he can get his hands on. Sure enough, when Jose make the announcement, the price of Waves stock immediately rises from $1 to $50 a share.

What SEC (security and exchange commission) rule, if any, is Jose likely to have violated?
Has Jose in fact violated that rule? Explain.
 
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