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Financial Markets Conduct Act 2013

Dealing in financial products on markets - Insider trading - Insider conduct prohibited

244: Criminal liability for insider conduct

You could also call this:

"Breaking insider trading rules can lead to prison or big fines if you use secret information unfairly."

Illustration for Financial Markets Conduct Act 2013

If you break the rules in sections 241 to 243 of the Financial Markets Conduct Act 2013, you commit a crime if you know the information is important and not available to everyone. You must also know that the information is not public. If you are talking about section 242, you must know about the specific things mentioned in that section. You can be punished if you commit this crime. If you are an individual, you can go to prison for up to 5 years, get a fine of up to $500,000, or both, and if you are not an individual, you can get a fine of up to $2.5 million.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4091326.

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rulesBusiness > Fair trading
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243: Information insider must not advise or encourage trading, or

"Insiders can't tell others to buy or sell company shares or products"

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245: Exception for trading required by enactment or rule of law, or

"Trading is okay if a law or rule says you have to do it"

Part 5Dealing in financial products on markets
Insider trading: Insider conduct prohibited

244Criminal liability for insider conduct

  1. A person who contravenes any of sections 241 to 243 commits an offence if the person knows—

  2. that the information is material information; and
    1. that the information is not generally available to the market; and
      1. in the case of a contravention of section 242, of any of the matters set out in section 242(1)(a) or (b) or (2)(a) or (b).

        1. A person who commits an offence under subsection (1) is liable on conviction,—

        2. in the case of an individual, to imprisonment for a term not exceeding 5 years, a fine not exceeding $500,000, or both; and
          1. in any other case, to a fine not exceeding $2.5 million.

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