This is a case study on a charge of Insider Trading with fine as the resulting sentencing penalty.
Our client was charged with Insider Trading and was arrested following an ASIC investigation sparked by its Market Surveillance Team and investigation by ASIC’s Market Integrity Enforcement team.
What is alleged to have occurred?
The client was part of a team working on a proposed take-over and was privy to proposed takeover bids. Some shares were purchased on his behalf with the benefit of that information.
Insider Trading is a serious offence under the Australian Corporations Act 2001. The elements of this offence include a person trading in financial products while in possession of ‘inside information’, or passing on ‘inside information’ which they either knew or should have reasonably known they were in possession of at the time.
To put it another way, Insider Trading involves buying or selling a company’s shares based on confidential information about that company. It also includes the actions of individuals who share this inside information with others, knowing that those recipients might trade shares or other financial products based on it.
The penalties for Insider Trading are severe, as it can attract a maximum sentence of 15 years imprisonment.
What was the result?
For the charge of Insider Trading, a fine of $15,000 was imposed. The client was also sentenced to a 12-month suspended sentence for some remaining charges.
This was a great result given that the Courts have indicated that this sort of offending should normally result in actual gaol time.
The reason for the result was that there were factual issues in the trades that were able to be presented in mitigation. Also, the client was a man of good character whose circumstances were such that a prison term would have been devastating for him.
Please note that each case is unique and requires an individual approach and strategy.
DISCLAIMER: This is a real case study of an actual case from our files. Details pertaining to the client have been changed to protect their privacy. The sentence imposed and the charge have not been altered. These case studies are published to demonstrate real outcomes and give an indication of possible tariffs in Court. We do not guarantee a similar case on these charges will get the same result. Please note that we post results at our discretion, therefore while many case studies are average results, others are notable for their exceptional outcomes. PUBLISHED 09/10/2024
