SOME INFO FROM THE INSIDER TRADING TASK FORCE

I find the last excerpt interesting.

Canada's securities regulators responsible for regulating insider trading combined in 2002 to form the Insider Trading Task Force with the objective of evaluating how best to address illegal insider trading on Canadian capital markets.

HERE ARE SOME EXCERPTS FROM THE INTRODUCTION>

Insider Trading as a Violation:

Illegal insider trading involves the buying or selling of a security while in the possession of undisclosed material information.

Markets operate efficiently on the basis of timely and full disclosure of all material information. Trading on inside information, including illegal insider trading produces victims: They include:

The investor. Unaware of the inside information, who transacts with a person who knows of the information.

Market participants in general. A market that permits those with inside information to benefit to a greater extent than others results in a market that is inherently unfair, to the detriment of those participants who have no inside information.

In the specific instance of insiders of an issuer structuring their acquisition of securities from the treasury with knowledge of inside information, the issuer's shareholders may be victimized due to the dilution of the value of their shareholdings if those treasury securities are issued at a price that is lower than would have applied had the information been disclosed. Equally, the issuer would be victimized as a result of being induced to issue undervalued securities.