Title: Saint Lucian Securities Law: Insider Trading Prohibitions and Penalties

Overview

The Financial Services Regulatory Commission (FSRC) of Saint Lucia enforces strict regulations against insider trading, as outlined in Section f115 of the Financial Services Act. In this article, we will discuss the definition of insider dealing, associated penalties, and the FSRC’s stance on insider trading.

Insider Dealing: Definition

According to the regulation, an insider is any individual in possession of confidential information concerning securities. An insider who engages in insider dealing may face legal consequences:

1. Dealing in securities affected by the privileged information
2. Encouraging others to do the same
3. Disclosing the information to non-authorized parties

Consequences of Insider Dealing

Legal Penalties

Under subsection (2), the offense of insider dealing is punishable by:

• A fine of up to $500,000
• Imprisonment for a maximum term of 5 years
• Both a fine and imprisonment

Penalties to the FSRC

The court may also impose a penalty payable to the FSRC, equal to three times the profit gained or loss avoided by the involved parties through insider trading activity.

Covering Direct Losses

A convicted individual is responsible for covering any direct losses incurred by other parties as a result of the insider dealing under subsection (3a), with exceptions to those who were directly involved.

Accounting for Direct Benefits

Additionally, a convicted person must account for any direct benefits or advantages received under subsection 3b.

Insider Trading’s Impact

Insider trading does not nullify contract enforceability (subsection 4). The FSRC’s primary role is to maintain the integrity and transparency of the financial market. Insider trading poses a threat to these principles and may result in unfair advantages and market manipulation.