Saturday, August 24, 2019 11:08:36 AM - Markets open
VN-INDEX 992.45 -4.81/-0.48%
HNX-INDEX 103.25 -0.24/-0.24%
UPCOM-INDEX 57.95 +0.01/+0.02%
Calls for insider traders to be dealt with criminally
Vietnam News - 7/15/2019 1:07:03 PM
 (0 ratings. You must sign in to rate.)
Illegal insider stock trading requires a stronger deterrent from regulatory agencies to stabilise the market sentiment, according to tinnhanhchungkhoan.vn.
 
Insider stock trading among business leaders has existed for years and been a thorn in the side of investors due to a lack of appropriate punishments.
 
In the past six months, the State Securities Commission (SSC) has punished several company leaders for violating rules on the transparency of stock trading.
 
On July 3, the SSC issued a fine worth VNĐ17.5 million (US$752.5) on a member of the board of directors in Cà Mau Water JSC (UPCoM: CMW) for selling the company's shares before the allowed period.
 
A fine worth VNĐ55 million was imposed on a deputy director of Vinacomin-Water Transport JSC (UPCoM: WTC) as he bought shares without reporting the deal to the SSC and the Hà Nội Stock Exchange (HNX).
 
Such transactions cause concern as the firms' leaders will have more information than other investors, allowing them to make personal profits.
 
Some investors are questioning whether insider trading is illegal or not and what lies behind those leaders’ actions.
 
According to Eiichiro Kawabe, deputy commissioner for international affairs at the Japan Financial Services Association, many company leaders and those with similar benefits learn information earlier than common investors to do non-public deals that bring them profits.
 
If the market regulator is not sharp enough, such wrongdoings may erode investors’ confidence in the equities market.
 
Hoàng Văn Cường, commissioner of the National Assembly’s finance and budget committee, said there must be a regulation to deal with such wrongdoings soon to help the equities market develop transparently and healthily.
 
Experts have suggested illegal insider stock trading must be handled by penal sanctions, not by fines, with the sanctions stated in the Law on Securities, which is being discussed in the National Assembly.
 
One measure is to force business leaders to clarify why they made illegal insider transactions and to publicise those reasons.
 
Some analysts and investors have suggested those violating the rules must be fined heavily and be restricted from trading stocks for a period of time.
 
However the new Law on Securities, which is expected to be passed late this year, doesn’t contain any penal actions for wrongdoings on the market.
 
The proposed maximum penalty for an individual violation is VNĐ1.5 billion and VNĐ3 billion for an organisational action.
 
According to Eiichiro Kawabe, information transparency is an important and decisive factor to determine how resources are allocated on the equities market. That requires material information to be provided accurately, fully and be understandable.
 
If existing punishments are not strict enough to deal with market wrongdoings, investors will lose confidence in the market.
 
Therefore, it is important to increase sanctions for trading violations. In Japan, penal punishments are used alongside fines to ensure insider trading doesn’t destabilise the market.
 
In addition, market members and regulators must improve their systems and technologies to discover and prevent illegal insider trading. – VNS
 
 
Read original article here
 
Newer News
21/08 Shares advance as blue-chips gain ground
20/08 Shares move up with strong divergence among large-caps
19/08 Vietnam stocks predicted to swing for another week
15/08 Securities regulator unveils corporate governance code
14/08 Investors cheer US tariff delay
14/08 Post-merger stock exchange headquarters in Hanoi
11/08 Listed companies honoured for best investor relations
09/08 VN-Index makes progress on purchase power
08/08 VN shares move up but liquidity modest
07/08 Shares slide, money flows into industrial sector
Older News
12/07 Shares extend rally on credit growth limit relaxation
11/07 Shares advance for second day on foreign buying
10/07 Deutsche Bank's restructuring not expected to harm VN market
09/07 Securities firms warn listed businesses may struggle to meet EVFTA standards
08/07 VN stocks may keep rising, driven by corporate earnings
05/07 Transparency needed for healthier corporate bond market
05/07 VN stocks up, earnings hopes raise market sentiment
04/07 Vietnamese shares drop as worries persist over global slowdown
03/07 Global worries pull VN stocks down
02/07 VN stocks climb with hopes for trade deal, corporate earnings
 
Newsletter Signup
Top Stories
Shrimp export to China sees positive signs
Post-merger stock exchange headquarters in Hanoi
Listed companies honoured for best investor relations
Reference exchange rate up 2 VND on August 7
VN has trade surplus of about $1.6 billion in H1
Market Update
Last updated at 3:10:01 PM
VN-INDEX 992.45 -4.81/-0.48%
Real-time chart
Top 5 Actives
Top 5 Gainers
Top 5 Losers
My Favorite Quotes
Your most recently viewed tickers will automatically show up here if you type a ticker in the Get Quotes box on the top of the page.
Company Research
Type in the symbol above for thorough background information, key statistics and financial information.
Stock Sectors
We continuously improve our services, here are the latest updates...
Portfolio
Allow you to monitor a customised group of securities. You can set up multiple Portfolios to help you better manage your investments.
Trigger Alerts
Get up-to-date alerts delivered directly to your email address.
Stock Screener
Allow you to filter the market and find exactly what sort of company you are looking for.
Live Terminal
Get instant access to FREE REAL-TIME streaming quotes for hundreds of stocks from HOSE, HNX and UPCOM exchanges.