What is the law on insider trading?

Insider trading is a type of securities fraud that involves trading stocks or other securities with non-public information. In South Carolina, insider trading is against the law. Under the federal Insider Trading and Securities Fraud Enforcement Act of 1988, it is illegal for anyone to trade in securities, such as stocks, bonds, futures, or derivatives, if they have access to material non-public information (MNPI). It also applies to anyone who obtains such knowledge from someone else who has access to MNPI. The law is enforced by the United States Securities and Exchange Commission (SEC). The SEC monitors the stock market to identify any unusual or suspicious trading patterns that might indicate someone is taking advantage of MNPI. If the SEC suspects insider trading, it will investigate and seek civil or criminal penalties. The punishments may include fines, disgorgement (forced repayment of ill-gotten gains) and even imprisonment in some cases. Additionally, South Carolina has the South Carolina Uniform Securities Act, which stipulates that insider trading is prohibited. It also requires that insider trades be reported, as well as any other transactions deemed suspicious. The South Carolina Securities Division is responsible for enforcing the Act by investigating potential violations. Overall, the law on insider trading in South Carolina is stringent. Anyone caught engaging in such activities can face serious consequences, including criminal prosecution. Therefore, it is important to always be aware of the law and to trade stocks with caution.

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