Insider Trading Sanctions Act Of 1984

AAA

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.

RELATED TERMS
  1. Insider Trading Act of 1988

    An act enabled in 1988 to increase the liability penalties to ...
  2. Securities And Exchange Commission ...

    A government commission created by Congress to regulate the securities ...
  3. Whistleblower

    Anyone who has and reports insider knowledge of illegal activities ...
  4. Insider Trading

    The buying or selling of a security by someone who has access ...
  5. Insider Information

    A non-public fact regarding the plans or condition of a publicly ...
  6. Mandatory Binding Arbitration

    A contract provision that requires the parties to resolve contract ...
RELATED FAQS
  1. Can a business ever be too small to issue commercial paper?

    There are effective – though not legal – restrictions on the size of commercial paper issuers. Any company can issue commercial ... Read Full Answer >>
  2. How does an underwriter syndicate work together on an initial public offering (IPO)?

    An underwriting syndicate is a group of investment banks that share the responsibility of marketing the shares of a company ... Read Full Answer >>
  3. What is the difference between the Sarbanes-Oxley Act and the Dodd-Frank Act?

    The Sarbanes-Oxley Act (SOX) was enacted to protect investors from potential fraudulent accounting by companies, whereas ... Read Full Answer >>
  4. How often should I measure my company's key performance metrics (KPIs)?

    Insider trading is a trade made with material and nonpublic information. Insider trading undermines the integrity of security ... Read Full Answer >>
  5. What sectors are best for an investor seeking a high annual return?

    A company receives a share premium whenever it receives money in excess of the face value (par value) of its shares. Corporations ... Read Full Answer >>
  6. If I write a blog post about stocks I own, is that considered insider trading?

    Writing a blog post about stocks you own is not considered insider trading. The only duty of the blogger is to disclose he ... Read Full Answer >>
Related Articles
  1. Markets

    What Investors Can Learn From Insider Trading

    Some insider trading is actually legal - and can be extremely telling for investors.
  2. Economics

    Defining Illegal Insider Trading

    The better you understand why insider trading can be criminal, the better you'll understand how the market works.
  3. Markets

    Infamous Insider Traders

    Check out these bizarre insider trading cases that helped define the SEC's laws against it.
  4. Investing Basics

    Policing The Securities Market: An Overview Of The SEC

    Find out how this regulatory body protects the rights of investors.
  5. Options & Futures

    Keeping An Eye On The Activities Of Insiders And Institutions

    These transactions reveal much about a stock. We go over what to consider and where to find it.
  6. Trading Systems & Software

    Steps to Starting Up an Independent Broker Dealer

    Launching your own broker-dealer is a lot of work, but the potential payoff is great, both personally and financially.
  7. Economics

    Understanding Money Laundering

    The process of creating the appearance that large amounts of money obtained from serious crimes actually originated from a legitimate source.
  8. Investing News

    New Avenues For Bitcoin Funding Opened Up By SEC

    Could New SEC Regulations Pave the Way for Investing in Bitcoin Startups?
  9. Economics

    What Happens When A Stock Broker Goes Bust?

    While there is nothing much that can be done against the market volatility, there is a protection mechanism in place in case the broker firm runs into a financial trouble.
  10. Economics

    Explaining the Glass-Steagall Act

    An act the U.S. Congress passed in 1933 as the Banking Act, which prohibited commercial banks from participating in the investment banking business.

You May Also Like

Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  3. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  4. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
  5. Rule Of 70

    A way to estimate the number of years it takes for a certain variable to double. The rule of 70 states that in order to estimate ...
  6. Risk Premium

    The return in excess of the risk-free rate of return that an investment is expected to yield. An asset's risk premium is ...
Trading Center