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Do's and Don'ts: Insider Trading

The following illustrates do's and don'ts of insider trading and securities law

THE DO's

  • DO remember that it is a federal crime to trade securities based on "INSIDE INFORMATION" - information you learn about your company or a closely allied company which is not generally available to the public, and which could cause the security's price to change if it became known.


  • DO keep all insider information confidential.


  • DO check your company's trading policies, or speak with a company attorney, before trading in your company's or a closely allied company's securities.


  • DO keep up to date with how trading laws and your company's trading policies apply to your position in the company, especially if you're an officer or director.


THE DON'Ts

  • DON'T ever trade securities on inside information.


  • DON'T act on someone else's "hot tips" that might be based on inside information-it's just as illegal as trading on inside information you've learned about your own company.


  • DON'T tell anyone inside information, not even family.


  • DON'T "just recommend" a trade, even without giving a reason, based on inside information.


  • DON'T give out untrue or misleading information that others might think is an insider tip.


  • DON'T look for clever ways to trade on inside information. The U.S. government and the exchanges have many more clever ways of catching inside traders.


Next Steps
Contact a qualified business attorney to help you
address the finances vital to your business.
(e.g., Chicago, IL or 60611)

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