What is the difference between insider trading and investment fraud?

Insider trading and investment fraud are two different types of financial misconduct. Insider trading occurs when a person with confidential information relating to a company or its stock exchanges that information for personal gain. For example, if an employee of a company knows of an imminent change or event that will cause the stock to rise or fall in value, they may use that information to purchase or sell the stock before the news is made public. Investment fraud, on the other hand, involves deceit and misrepresentation in order to convince someone to invest in something that is not legitimate. Investment fraud generally involves fraudsters who promise high returns or other financial rewards without providing any evidence or proof that they can deliver on their promises. In Virginia, both insider trading and investment fraud are illegal and prohibited. It is illegal to engage in insider trading of any kind and violators can be subject to prosecution and fines. Investment fraud is also illegal and violators can be subject to civil and criminal penalties. This includes prison time and fines. Anyone who suspects that they are the victim of investment fraud in Virginia should contact the Virginia State Securities Commission for help.

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What is the difference between insider trading and investment fraud?

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