US insider trading enforcement goes global

Abstract

Purpose

The purpose of the paper is to discuss the SEC's increased willingness to pursue insider trading enforcement actions related to transactions that take place largely outside the USA.

Design/methodology/approach

The paper describes several recent insider trading enforcement actions with international dimensions and the substantial cross-border cooperation among different countries' securities regulators that is required for cases to be successfully investigated. The paper draws conclusions and recommends steps for firms to take including a review of policies and procedures and how the firm receives and shares information, training programs, tailored protocols for ongoing monitoring and surveillance of trading activity, and contingency plans for possible future responses to insider trading problems and cross-border regulatory investigations.

Findings

The SEC has in recent years shown an increasing willingness to pursue insider trading enforcement actions with substantial international dimensions.

Practical implications

Internationally active firms should be aware of the breadth and intensity of the SEC's focus on cross-border insider trading matters and should prepare internal blueprints for how to respond to potential insider trading issues when they arise.

Originality/value

The paper presents practical guidance from experienced financial services lawyers.

Citation

Lehtman, J. and White, W. (2013), "US insider trading enforcement goes global", Journal of Investment Compliance, Vol. 14 No. 3, pp. 4-10. https://doi.org/10.1108/JOIC-09-2013-0025