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...