Insider dealing
Produced in partnership with Joanna Dimmock, Tom Hickey and Fred Kelly of White & Case LLP

The following Corporate Crime practice note produced in partnership with Joanna Dimmock, Tom Hickey and Fred Kelly of White & Case LLP provides comprehensive and up to date legal information covering:

  • Insider dealing
  • Insider dealing—the criminal offence
  • The offences
  • 'Professional intermediary'
  • Territorial scope of the insider dealing offence
  • CJA 1993, s 55—definitions
  • Dealing
  • Price-affected Securities
  • Who is an insider for the purposes of insider dealing offences?
  • What is an inside source?
  • More...

Insider dealing

FORTHCOMING CHANGE: Section 31(1) of the Financial Services Act 2021 (FSA 2021) increases the maximum sentence for insider dealing under section 61(1)(b) of the Criminal Justice Act 1993 from seven to ten years imprisonment. This section comes into force on a date to be appointed in accordance with regulations to be made under FSA 2021, s 49(5).

Insider dealing—the criminal offence

Insider dealing is the use of sensitive or privileged information that has not yet been released to the public in order to take advantage of the market. An offence is committed where someone in possession of inside information uses that information to deal in price-affected securities or to encourage another person to deal in price-affected securities, or where someone discloses information to another otherwise than in the proper performance of his employment, office or profession.

An example would be to take company 'A', with a share price of £10. Company A is aware of an imminent takeover by a corporation that would push the share price to £20. An insider working in company A would aim to purchase company A shares below the £20 mark and take advantage of their knowledge before the information is made public.

The concept of insider dealing encompasses the misuse of information to avoid a loss as well as to make a profit. For example, an insider who knows of the

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