Insider Trading In India: An Analysis On Ethical And Legal Complexities Of Insider Trading

Vipin Kumar, S.K.J Law College, Gannipur, Muzaffarpur, Bihar

Shakti Kumar, S.K.J Law College, Gannipur, Muzaffarpur, Bihar

ABSTRACT

Insider trading has been extremely common for a long time. The frequency of this misconduct has been rising yearly. Insider trading has been defined and implied in several ways. Generally speaking, it involves using price- sensitive information that hasn't been publicised to make unlawful profits or prevent certain losses. The purchasing or selling of a security by a person with access to substantial non-public information about the security is known as insider trading. Depending on when and how the insider makes the deal, insider trading may be allowed or prohibited. One of the most heinous offences against fair dealing in the stock markets is insider trading. Every country has a completely different set of rules regarding the severity, dimension, and punishments of the offence. Insider trading of company shares based on confidential information to the exclusion of others is forbidden, with the aim of profiting from insider trading or protecting against potential losses in violation of a duty of confidence. Due to significant price swings in public company shares during mergers and acquisitions as well as illicit trading based on price-sensitive information that was not publicised, the Indian securities market has been extremely concerned in recent years. By labelling the most recent events, this article sheds light on the problems regarding Insider trading in India. This post concludes with a few original ideas for how to solve this pressing problem. At the end, there is a list of all the references used to support the theme.

Keywords: Insider Trading, India, Illegal insider, Connected Person, SEBI