Petsas heralds new route for securities enforcement

Author: | Published: 1 Apr 2005

Participants in Australia's financial services industry know the insider trading provisions of the Corporations Act 2001 well. Previous high-profile convictions of individuals such as investment banker Simon Hannes (2002) and investor Rene Rivkin (2003) have highlighted the very real prospect that those who are found by a court to have engaged in insider trading in Australia may receive a sentence of imprisonment.

Despite these examples, however, criminal prosecutions for insider trading breaches are relatively rare in Australia. While the Australian Stock Exchange (ASX) and the Australian Securities & Investments Commission (Asic) work together to monitor and investigate suspected contraventions of the insider trading provisions based on unusual share trading and the provision of information by whistleblowers, successful criminal prosecutions for insider trading breaches have proven difficult to achieve. A conviction for a criminal offence requires the Director of Public Prosecutions to establish the elements of that crime "beyond a reasonable doubt", and the elements of the insider trading provisions are notoriously...