Information can be different - everyone is used to public or private. But there are its types that are not at all well-known. Here, for example, insider information. What is this? What are they eating with? What is the concept of insider information? What are the features, the responsibility for its disclosure? How is this counteracted? How to determine the access order? Here is an incomplete list of questions that are answered in this article.
What is insider information?
This is significant service data that was not publicly disclosed. If this information becomes public, then significant fluctuations in the market value of the organization’s securities or other similar effects will occur. What is insider
information in practice
? This is information about the change of leadership (which will happen in the near future), and about a new strategy, product, technology, successful negotiations, the purchase of a controlling stake, financial reports and forecasts that indicate difficulties or, conversely, successful activities. Here is what insider information refers to. In a broad sense, this designation is applied to data that so far is known only to a certain circle of persons close to its source. Why is it given such value? As you can see, insider information is important because it allows you to judge how things will go with the company in the near future. So, if an ineffective manager is appointed, then it can be predicted that things will go wrong. And further in a similar way.
Legislation
The interaction with the state is stipulated by the law in Law N 224-FZ of 07.27.2010. The focus is on opposing the misuse of data of such importance that it can have a significant level of influence on the market. It should be noted that the concept of insider information did not exist at that moment, and a different designation was used - “official”. We will talk in more detail about the responsibility for disseminating information a little further, initially we will determine who has it.
Who owns insider information?
As a rule, the management of the enterprise has it. Although other employees (accountants, lawyers, and so on) may be among the owners of insider information. When the company in the process of transferring the relevant information to other persons, then they also begin to have it. They may include third-party lawyers, auditors, bankers, financial advisors, and people of other similar professions. To prevent this data from being used to destabilize the market and gain a significant profit for a group of people, in most countries of the world there are certain laws or regulations that are against the spread of insider information.
Administrative responsibility
It is provided for in article 15.21 of the Code of Administrative Offenses. If guilty of disclosing insider information is established, citizens may be fined between three and five thousand rubles. For officials, it ranges from 30,000 to 50,000. Also, if there are losses to the company, a person can be fined by their amount, but not less than seven hundred thousand rubles.
Criminal liability
A significant step in the fight against the misuse of information and market manipulation was the adoption of Law No. 141-FZ on October 30, 2009. He introduced criminal penalties for insider activities that entail losses. Among the amendments made, it is necessary to separately report on article 185.3 of the Criminal Code of the Russian Federation. Under it fall actions, due to which there is a sharp increase, decrease or support of the price of securities, despite external circumstances. The cause of the criminal prosecution may also be the effect on demand or the volume of trade in them. For these actions, liability is provided in the amount of 300 thousand rubles or up to 6 years in prison. These are the consequences of the dissemination and misuse of insider information.
Counteraction
Also, as part of the confrontation with insider law, Law No. 145626-5 of April 17, 2009 was adopted. It has a comprehensive solution for insider abuse. This bill applies to the financial and commodity markets. It was the first to define what insider information is. It also introduced a
legal regime for its application and use. So, in this law, it means specific and accurate information that was not disclosed, disseminated or made available to the general public, as well as data that constitute official, commercial and other secrets that only a certain circle of people have access to. Moreover, their disclosure, provision and distribution may have a significant impact on the price indicators of goods or financial instruments. In addition to everything described, the draft law defines the circle of insiders and prohibits the use of such information during transactions. Market participants are widely involved in identifying such cases. The law also gave the
Federal Financial Markets Service new powers so that they can more effectively identify and prevent offenses. They have the right to:
- request documents;
- carry out checks;
- receive explanations;
- send instructions to eliminate violations;
- suspend or revoke licenses.
Access Order: General
Since the features of the provision of information may vary from one case to another, we will consider them with a specific example of a fictitious bank. So, he must first indicate in the normative documents that everything is developed in accordance with the current legislation of the Russian Federation. Then the necessary terms are defined, the procedure for using data is compiled directly, and at the end the protection rules are drawn up.
Access Order: Information
It is necessary to create a list of data that relates to insider information. It should be drafted in such a way as not to conflict with regulatory legal acts. Also, an indication of what does not apply to this type of data will be useful. Usually this:
- Information that became known to an unlimited circle of people due to their distribution.
- Research that was carried out using publicly available information, as well as forecasts and assessments of prospects.
- Information that has been unlawfully disclosed or published in the media is not considered insider from the moment it appears in them.
Access Order: Insiders
It is also necessary to work out the question of who can receive this type of data. So, on the example of the bank we are considering, such people have access to insider information:
- Chairman of the Board.
- Board members.
- Deputy Chairman of the Board.
- Members of the collegial executive body.
- Revision Commission.
- External auditors.
- Credit and insurance organizations ;.
- Bank appraisers.
- News agencies that disclose the data provided by the bank.
- Individuals who have access to insider information on the basis of employment contracts.
- Rating agencies.
The procedure for access to insider information
It should be noted that only the person with whom the relevant civil law and / or labor agreement has been entered into can get acquainted with the information. So, employees of the bank, as well as customers within a certain framework, which are regulated by internal regulatory documentation, can access the data. Individuals' access to insider information may be provided in cases when an official statement is drawn up that justifies the reason for providing it to them. If it is necessary to disclose data to third parties, all of them must be indicated. All this needs to be worked out so that everyone who needs to get insider information (not to the detriment of the company) can get acquainted with it. It is also necessary to determine the terms after which a decision will be provided on the
transfer of information or the ban on such actions.
Conclusion
Finally, it should be recalled that the misuse of insider information entails liability. As they say, the more opportunities, the greater the demand. Therefore, you have to be careful when the object of work is insider information. This, we hope, clarified this article. But before gaining access to data of such importance, a person will need to make a certain career in the corresponding organization.