Insider Trading Lawyers

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What is Insider Trading?

Insider trading includes both illegal and legal conduct. Legal insider trading occurs when corporate insiders buy and sell stock within the corporation. Corporate insiders include the officers, directors, employees, and shareholders. These securities trades must be reported to the Securities Exchange Commission (SEC). Broadly speaking, illegal insider trading occurs when a person, who has special access to or is aware of unpublished corporate information, uses that information to make a profit by selling or buying corporate securities. If that person wrongfully obtains this nonpublic information, the trader has committed insider trading. Thus, a person can be guilty of insider trading for "tipping," or publicizing such nonpublic corporate information, or trading securities on the "tip." It is also possible to commit insider trading and have no affiliation at all with the corporation. The Securities Exchange Commission (SEC) has brought insider trading cases against:

What is an Insider?

Insiders are any shareholders who hold more than five percent of a company's voting stock. Insiders are also any corporate employees who have access to confidential corporate information. Information that affects a company's stock price or that might influence investor decisions that is not open to the general public is considered important confidential corporate information. Insiders must file with the Securities Exchange Commission (SEC) and report their trading activity.

Have You Been Accused of Insider Trading?

Insider trading has severe criminal and civil penalties. If you have been accused of insider trading by a regulatory securities agency, a securities attorney can help discuss your legal options and defenses. A securities lawyer can also help guide you through the complicated legal system and procedures necessary to mount a proper defense.

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Last Modified: 01-30-2013 04:15 PM PST

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