Insider Dealing

Who can commit the offence of insider dealing?

• an individual who has the inside information from the insider

• a company which has the inside information

• both company and individual can commit the offence under English laws

What is the difference between the UK and US regulations of insider dealing?

• In US a person in order to be considered as an insider should owe fiduciary duty to the company, whereas in UK this duty does not have to exist.

• In US the insider dealing is not a criminal offence, rather a civil misconduct whereas in UK it is criminal.

• Both jurisdictions have different elements of insider dealing

• All answers are correct

Which one is NOT a feature of inside information according to CJA 1993?

• inside information must be precise and specific

• inside information must not have been made public

• if made public it must have a significant effect on the price of the securities

• inside information should indicate a general situation in the market

What is the "gain" of insider dealing offence?

• avoiding loss

• making profit

• all are correct

• none is correct

Who can NOT be considered as an insider according to the CJA 1993?

• director, employees or shareholders, because they can legitimately trade based on inside information

• whoever who obtained the information directly or indirectly from the director, employees or shareholders

• only those who are in a special list can be considered as insiders, others can not become insiders

• no correct answer

What is the primary legislation regulating insider dealing in UK?

• Criminal Justice Act 1993

• Coroners and Juries Act 1993

• Care for Justice Act 1993

• Crime and Justice Act 1993

What is a price-affected security?

• It is a security price of which changed significantly after the inside information was made public

• It is a security which was affected by the crimes comitted in the company

• It is a security the price of which affects the stock exchange market the most

Which of the following is NOT an offence of insider dealing?

• Dealing in price-affected securities

• Encouraging others to deal

• Disclosure of inside information

• Not making inside information public

Information ‘likely to have a significant effect on price’ means

• information a reasonable investor would be likely to use as part of the basis of his or her investment decisions

• a trade that an investor would have made whether he or she had the inside information or not

• information that the investor reasonably thought to be public

• No correct answer

Which of the following is NOT a defence to the insider dealing offences?

• The defendant did not expect that dealing would result in a profit.

• The defendant had reasonable grounds to believe that the information had been sufficiently widely disclosed

• The defendant must be able to prove that she would have acted as she had acted whether or not she had the information

• The defendant confesses and pleads guilty