What is the maximum penalty for insider dealing?

Insider dealing, also referred to as insider trading, is a serious offense in securities regulation, involving the trading of a company's stock or other securities based on non-public, material information. The penalties for insider dealing are designed to deter individuals from abusing their access to confidential information.

The maximum penalty of seven years imprisonment and/or an unlimited fine is aligned with the severity of the crime and the potential damage it can cause to the fairness and integrity of the financial markets. This approach underscores the importance of maintaining investor confidence and ensuring that all participants in the market have equal access to relevant information.

The fine can be particularly severe, reflecting the potential profits that can be illicitly gained through insider trading, as well as the broader implications for market integrity. Financial regulators impose heavy penalties to discourage this behavior and promote ethical practices in business and finance.

Other potential penalties, like life imprisonment or penalties with fixed fines, would not accurately capture the legal approach toward insider dealing in most jurisdictions, as they seem disproportionate to the offense.