Insider dealing: fraud in Islam?

Siti Faridah Abdul Jabbar (School of Accounting, Universiti Kebangsaan Malaysia, Bangi, Malaysia)

Journal of Financial Crime

ISSN: 1359-0790

Publication date: 4 May 2012

Abstract

Purpose

The purpose of this paper is to examine whether insider dealing is fraud from the perspective of Islam.

Design/methodology/approach

The paper uses analogy (qiyas) of the injunctions in the Qur'an and Sunnah and critical analysis of literature on Islam.

Findings

The paper finds that insider dealing is fraud (taghrir) in Islam and the defrauded party has the option to rescind the transaction for fraud (khiyar al‐tadlis) as well as for latent defect (khiyar al‐‘aib).

Practical implications

The paper is practical as a source of reference in legislating laws relating to insider dealing particularly where Shari'ah is the principal source of law.

Originality/value

The paper presents a novel attempt in establishing that insider dealing is fraud from the perspective of Islam.

Keywords

Citation

Faridah Abdul Jabbar, S. (2012), "Insider dealing: fraud in Islam?", Journal of Financial Crime, Vol. 19 No. 2, pp. 140-148. https://doi.org/10.1108/13590791211220412

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2012, Emerald Group Publishing Limited

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