Yes, under "tipper-tippee" liability, individuals who share material nonpublic information (the "tipper") can be held accountable, even if they do not trade themselves. The recipient of the information (the "tippee") can also be prosecuted if they trade on that information, knowing it was disclosed improperly. This rule extends liability beyond direct participants to those involved in sharing the information.<\/span><\/p>"
}
}
,
{
"@type": "Question",
"name": "Is It Possible to Unknowingly Commit Insider Trading?",
"acceptedAnswer": {
"@type": "Answer",
"text": " Yes, one can imagine that someone might commit insider trading not knowing the trades were based on information that wasn't public or material. However, courts often consider intent and the context in which the information was obtained.<\/p>"
}
}
,
{
"@type": "Question",
"name": "How Do Insider Trading Cases Typically Unfold?",
"acceptedAnswer": {
"@type": "Answer",
"text": " Insider trading cases often start with the SEC or DOJ investigating suspicious trading patterns. Authorities look for evidence of nonpublic information being used to trade. Once evidence is gathered, the SEC may bring a civil lawsuit, while the DOJ may pursue criminal charges. High-profile cases, like those involving Raj Rajaratnam and Martha Stewart, often result in both fines and imprisonment.<\/p>"
}
}
]
} ] }
]