THE SCOPE OF INSIDER TRADING LIABILITY FOR TIPPEES UNDER THE NIGERIA’S INVESTMENT AND SECURITIES ACT

Abstract

The prohibition of insider trading is orchestrated by moral, social and economic considerations; but, more importantly, the acknowledgment that prosecuting insider trading is fundamental to the creation of a transparent and equal securities market for all participants. In keeping with this trend, various countries of the world have enacted laws to regulate insider trading. The United States of America obviously is at the forefront of the fight against this practice and she isclosely followed by the United Kingdom. Nigeria is not left out of the fight against insider trading via the Investment and Securities Exchange Act. However, the prohibition is not only restricted to insiders who might have traded on corporate securities on the basis of unpublished price securities but also to individuals who trade in a corporate securities based on unpublished price sensitive information received from corporate insiders otherwise known as tippees. This paper therefore critically examines the scope of insider trading liability for tippees under the Investment and Securities Act