Friendly ties and professional benefits tempt people, provoking them to give out confidential data that they have to face. Such information falls under the notion of "insider information" and may lead to dismissal from work or even criminal liability.
Insider Information - What Is This?
Insiders refer to people who have significant knowledge of someone for their duty of service or because they are acquainted with business and public people. The information they possess can be disclosed in several ways:
- Information about the personal life of the stars. This is a popular way to earn money among journalists and celebrity friends of any country. "Yellow" publications willingly buy gossip about adultery, new partners and family scandals of actors, singers and socialites.
- Financial reports and forecasts of stock exchanges and securities, as well as large banks. Shareholders, employees and auditors believe that insider information is forecasts about strengthening the dollar or euro exchange rate, development and merger prospects, annual reports and senior management plans. Forex players sometimes create groups in social networks in which they share money for quick enrichment for money.
- Data on sports betting. In football, basketball, hockey, the practice of contractual matches is common, on which all the teams dedicated to the agreement can win money.
In what form is it prohibited to use insider information?
To this type of information, it is easy to include any conversations, electronic correspondence, reports and reports containing secret data that can enrich the person who shares them. The misuse of insider information implies the communication to third parties:
- materials on tender participants and tender results;
- information obtained during the audit and examination of its results;
- decrees on revocation of licenses, cancellation of permits for any type of activity;
- decisions on administrative liability;
- details of the working and family relations of public people;
- disclosure of nuances of trading operations in foreign exchange markets.
Effective methods to combat insider information
Operational protection of insider information is beneficial primarily to the stars themselves, corporations and stock exchange players, so they are ready to pay considerable money to reliable security services, personal assistants for keeping secrets and suppressing other attempts at their dissemination. Sale of insider information will not take place if such tools for its prevention were used, such as:
- development and approval of the order of access to materials;
- constant updating of the rules for protecting its confidentiality;
- the creation of an official unit with a competent employee at the head, whose main responsibility will be to exercise control;
- providing legal conditions for the full operation of the security service;
- contact with similar organizations for the purpose of drawing up a "black list" of distributors.
Insider Information - Example
The largest and most famous case of leakage of business data was the case of TGS, which gave rise to the adoption of a law that discloses what insider information means. The enterprise was engaged in extraction of minerals of different types: once one of its divisions discovered new deposits, but the authorities did not rush to inform. The vice-president of the corporation knew about the opening - and he bought TGS from his owner. Immediately after the deal, he highlighted the event in the media and was able to sell the company 5 times more expensive. The investment market was seriously affected and was forced to take action.
Insider information on sports
In bets, classified data takes the form of a special category of investment that appears rarely because not every informed person decides to openly disseminate what is included in the concept of "insider information about contract matches". People who are keen on sports betting know where to look for data that can earn money:
- on specialized sites, whose owners keep their identity secret;
- among experienced fans who are in close contact with the players and the owners of the club;
- in groups on closed type insider in social networks;
- at meetings of the syndicate of professionals in sports betting.
Insider Information on Forex
Trading became fashionable several years ago as a way of additional or basic earnings. The use of insider information in this industry thrives without regard for prohibitions and strict legislation. There is an algorithm for successful trading in the Forex market, based on the illegal receipt of information:
- accumulation of capital;
- search for a person who knows what insider information is;
- installation of the Forex platform;
- choosing a reliable broker;
- start trading.
Responsibility for the use of insider information
Punishment is not assigned for the discussion and dissemination of data, which are already freely available in the press and the Internet. Public studies, sociological surveys and materials taken from official interviews fall under the same category. All the rest is the illegal use of insider information, punishable by one of the types of liability:
- Criminal - a large monetary fine, confiscation of property, deprivation of a position without the right to occupy it for a certain period, imprisonment.
- Administrative - fine, compensation for damages, reprimand, restriction of freedom.
- Arbitration - insider information and commercial secrets can be protected by the judicial board.