Insider Trading Sanctions Act Of 1984

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DEFINITION of 'Insider Trading Sanctions Act Of 1984'

Legislation that allows the SEC to seek a civil penalty, of up to three times the amount of profit or loss, from those found guilty of using insider information in trades, as well those who provided information not generally available to the public. The Insider Trading Sanctions Act of 1984 also provides for criminal fines to be levied.

INVESTOPEDIA EXPLAINS 'Insider Trading Sanctions Act Of 1984'

The U.S. Congress passed the Insider Trading Sanctions Act of 1984 in order to help the SEC prosecute those accused of insider trading, which was a top priority in the 1980s. Before the Act was passed, the amount a trader could make through insider trading, far outweighed the potential financial penalties.

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