Assignment on Insider Trading PDF
Added on 2020-01-07
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Law case brief
Table of ContentsINTRODUCTION...........................................................................................................................3TASK.1............................................................................................................................................3TASK.2............................................................................................................................................3TASK.3............................................................................................................................................4TASK.4............................................................................................................................................5TASK.5............................................................................................................................................5CONCLUSION................................................................................................................................7REFERENCES................................................................................................................................8
Insider Trading It is kind of offence which is done by the existing employees through publicized somevaluable information of company. These are mostly dealing with the company securities whichare not available to general public. Insider trading is the practice which is both of the types, legalor illegal. The legal are not detrimental to the company and outsiders as well, but illegal insidertrading means unpublished price sensitive information which is so sensitive and possessor ofsuch information trades and gain the profits on behalf of such information. Insider tradingbecomes illegal if the material information is unpublished and trades on behalf of suchinformation. Trading having the information about the special knowledge is not fair to the otherinvestors who is not having the unpublished information. Under the given case, it has been seenthat Mr. Curtis had been found guilty of an offence of insider trading within which the jury of thesupreme court sentenced Mr. Curtis imprisoned for two years.R v Curtis (No 3) [2016] NSWSC 866According to Corporations Act, 2001, it was notices that Mr Curtis was found guilty andimposed several charges of conspiracy to commit insider trading as per mentioned act. In supreme court order with his jury found Curtis guilty in doing fraud as insider trading and onthe basis of this he ordered two year of imprisonment from 24th June 2016 to 23rd June 2018. ithas been found that the insider trading does have the strict or heavy penalties but still many ofthe people trades on the basis of unpublished price sensitive information and makes the profitson the basis of such information. Under the given case, it has been seen that the Mr. Curtis wasfound two years imprisonments after disclosing the insider trading scam. According to section 103A(1)(d) of the corporation Act specified that the individual whohave the unpublished price sensitive information and also who knows that specified matters aresatisfied with regards to the information 1. He need not procure other individual to apply for,acquire or dispose off, concerned division 3 financial products. The particular matter which theindividual(insider) is required to know are satisfied with regards to the information are that:Information is not normally available; andIn that case, if the information is generally available, a reasonable person will expect it tohave a material effect on the price or value of particular division 3 specified division. 1Acharya, V.V and Johnson, T.C., (2010). More insiders, more insider trading: Evidencefrom private-equity buyouts. Journal of Financial Economics. 98(3). pp.500-523.
Mr. Curtis was charged with the offence of insider trading and he was penalised for twoyear imprisonment. Although he was having the unpublished price sensitive information whichwas not to be disclosed till it goes published. But, he traded and make the profits on behalf ofsuch information. After knowing such insider trading information, he was found guilty. The supreme court which is headed by the McCallam J and the regarded jury discoveredMr. Curtis guilty of an offense of insider trading as per section 1043A(1)(d) and other significantsections of the Corporation Act and the detainment was currently to be required for insidertrading (Kim, 2012). The Crimes Act, 1994 emphasis that the court need to impose a strict final judgement,which is proper in all the circumstances of the offence. In case of conspiracy, the concernedoffence is the agreement which incorporates the conspiracy. Although, Subsequent to having thenature and circumstances of the cited offense covering reviewing the substance, time period andtruly of conspiracy covering Mr. Curtis' part in its succeeding uses and having respects to wholeconditions of the offense, the supreme court judges concluded that the objective seriousness ofthe offence was on the peak. After getting the conclusion, respected judge campaign acceptedevidences which are related to the case. These are:Mr Curtis and Hartman both are interacting with each other by using blackberry mobilephone, which fully encrypted and having secure communication system. Mr. Curtis was had proposed correspondence by sticking and had brought blackberry ashe trusted their correspondence by that implies would be imperceptible. In addition, Mr. Curtiswas given funding to begin the exchanging. In spite of the fact that Mr Hartman, strengthened the guilt among parties to commitoffence of insider trading. In may,2007 a huge margin of 1433727.85 was made a outcome ofmessages that was send from Mr Hartman from its device under which trading guidance wasgiven to Mr Oliver who are acting on it and involve in 45 illegal transaction.The base of the connivance was that Mr. Curtis bring out 45 trades over a time of 14months on guidelines he accepted to be relies on upon inside data 2. While he won't not haveknown deliberately why the trading was so gainful, the reality was that it was beneficial, with thetwo men making a net benefit around $1.43 Million. As per available evidence provided to ASICunder section 19 of the act it should not be used as evidence by prosecutors.2Agrawal, A and Cooper, T., 2015. Insider trading before accounting scandals. Journalof Corporate Finance. 34. pp.169-190.
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