What is market abuse?
market abuse is a type of financial crime that results from attempts to manipulate the financial market or use information about the initiated. The prevention of market abuse is important because it creates equal conditions for all investors. In many regions, market abuse is a crime that can lead to prison and fines.
One of the largest contributors to market abuse is trading of initiated persons. This type of crime occurs when a person with specific information about initiated market information buys or sells shares to benefit or avoid losses. For example, if an employee gets a takeover in the company, he can use this information to sell shares in a company that is going to accept. This is considered unethical and often illegal, because a person who buys shares might not do so if he knew about taking over.
To be able to ODWalking with initiates qualified as market abuse, it should be shown that the information used to make the shops accessible was not publicly available. For example, a person who sells shares for a company to be taken will probably not be charged with dedicated trading if they sell them after a public takeover. After the announcement of the agreement, ignorance of the agreement is no longer considered to be mitigating. In addition, charges of dedicated trading are usually reserved only for higher -level officers or those who own a significant part of the company's own capital.
The second main category of market abuse is also called illegal manipulation. There are a number of ways to illegally manipulate the financial market for profit, but many of them are very difficult to prove in court. Illegal manipulation is sometimes considered to be a restriction of trade because it generally focuses on changing the natural flow of the market for misinformation and distortion. This type of abuse of an IS market severely regulated against AMEric and European market directives and against fraud.
Manipulative forms of market abuse often revolve around false or misleading information and actions. For example, if a person sends e -mail shareholders about a planned merger that he knows is false and false, it could artificially manipulate this information because shareholders respond to false information. Integrance of manipulative business behavior can also be interpreted as a market abuse, such as buying a huge amount of shares in a company with an explicit intention to raise the price. Given that many of these manipulative crimes are based on intention, it is often very difficult to successfully prosecute despite strict regulations.