How do governments catch 'insider trading'?

>>1105118
The only way they catch you is if there is:
1) a paper trail
2) you work for the company and had access to highly restricted information (basically unpublished financials) which you traded on.

>>1105128
could you elaborate on 1) and 2) and how that would even lead to you being caught? Wtf is a paper trail?

Isnt it impossible to catch someone as long as they do the trading at home on their personal PC

>>1105137
After seeing #2 Don't do this, you clearly don't know anything.

>>1105142
I dont work for an auditing company or a company.
>you clearly don't know anything.
Thats why im asking. . . How would they track someone if they got "tipped"

>>1105150
If a friend sends you a text message with the tip, and you act on it there's a record for all time. The only way I'd risk acting on insider information would be if it was something that was never in written or electronic form e.g. you had lunch together and your friend mentioned it.

>>1105160
Well thats exactly what I mean, its obvious that any form of communication apart from verbal can be tracked back.

>Know auditor friends
>Organize meet up (verbally tell)
>Discuss financials
>Tip
>Make millions

I just mean to what extent can you get away with it. Its obviously not traceable.

Even millions in the grand scheme of things is a small portion that no one can ever notice (assuming the company has a large market cap)

Also how is this even illegal? The market does not always behave rationally, just because you see that the financials of a company arent good in this quarter before everyone else doesnt mean that the next day the statements are release the share price will drop, for all you know it could go up

>>1105118
It's selectively enforced against people that the government and/ or banks have a beef with. It's standard practice for those in power, though.

>>1105167
Trading on nonpublic information is illegal independent of whether you make a profit from it.

But really, the economics problem here is that they can't act on this information and can't get money from your bank account, but bear virtually all the risk on their side. What's in it for them? Even if you organize a party with a bunch of Auditors and try to get them to all spill the beans, it's incredibly risky for them to trade on each other's private information because of their profession being closely scrutinized.

>>1105175
>but bear virtually all the risk on their side.

I dont think youre getting what im trying to say.

Im basically saying what happens when you and your auditor friend work together in this type of scenario, he tips you off, you make security purchases, you split money.

And assuming that you and your auditor friend dont have a fall out and get greedy and work perfectly.

From this point, how are you being noticed by the government. It looks impossible to me.

>>1105177
>you split money
How?

>>1105178
>Decide when to call it quits and agree on amount
>Liquidate shares over a couple of weeks
>Withdraw half
>Keep half
>Gibs money to your friend in 100's

profit for everyone?

>>1105178
so is >>1105179
in the clear?

File: 12438990_10153200807871954_3896611076946397590_n.jpg (114KB, 960x960px) Image search: [Google]

114KB, 960x960px

>Mfw someone traded $14mil of a spec mining stock on the ASX on Friday

>>1105217
Maybe. If you are just trading the underlying, you might get away with it. If you are using a ton of leverage, that apparently sets off red flags with the SEC.

The issue is then that your friend basically has to keep a bunch of money under his mattress since if he deposits too much cash into his bank account over too short a period, that will also trigger a currency transaction report.

>>1105221
kuroneko a cute, also, how do you know that a singular person traded $14m worth? or do you mean 14m in volume so you speculate its a person, or a small group of people

>>1105222
>Deposit will trigger
Yeah, I suppose, but adding little lumps over time wouldnt really do anything, he could buy assets with cash too, im not too concerned about this fact, money is money senpai

>>1105118
nice try, SEC