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Insider dealing - Coggle Diagram
Insider dealing
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Defence
The individual did not, at the time, expect the dealing to result in a profit or to avoid a loss.
· The accused shows that he would have acted as he did even if he had not had the information, for example, the individual was forced to sell through economic necessity.
· A further defence exists where it can be shown on reasonable grounds that the individual believed the information had been disclosed widely enough to ensure that none of those taking part in the dealing would be prejudiced by not having the information.
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· That although they expected dealing would occur, they did not expect that the dealing would result in a profit attributable to the fact that the information was price sensitive.
An insider
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(a) It is, and he knows that it is, inside information
(b) He has it and knows that he has it, from an inside source.
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Penalties
Insider dealing - fine not exceeding the statutory maximum (£5,000) or imprisonment for a term not exceeding six months or both
Conviction on indictment - the penalty is an unlimited fine, imprisonment for a maximum of seven years or both.
The deliberate exploitation of information by dealing in securities or their derivatives having obtained that information by virtue of some privileged relationship or position.
offence of ‘insider dealing’ and ‘market abuse’ both arising under the Criminal Justice Act 1993 (CJA)