In the scenario where Todd overhears a rumor about Datagen, he mainly violated the Standards by:

In this scenario, the primary violation pertains to Todd not having a reasonable basis for his investment decision. This emphasizes the ethical responsibility that professionals have to back their investment recommendations with sound analysis and reliable information. When Todd acts on a rumor without confirming its accuracy or validity, he lacks the necessary foundation for making informed decisions. This failure can lead to poor investment advice and potentially harm clients who rely on Todd's expertise.

In the investment industry, acting without a reasonable basis can undermine the integrity of the financial markets and violate the ethical standards that require professionals to conduct thorough research and due diligence before making investment recommendations. It highlights the importance of ensuring that decisions are based on verified information rather than hearsay or speculation, thus protecting the interests of investors and maintaining trust in the system.