The Morality of Insider Trading: Devil's Advocate

Abstract

The quest for commercial success creates a fertile ground for vices such as greed, dishonesty, lies and fraud. These manifest in various shades and forms. Some are very subtle and difficult to detect. Others are very overt and earn societal scorn. Arguably, a dynamic businessman looks for opportunities, wherever they may be found, to advance his or her business and to be able to take as much of the market share as is possible. After all, the market has not ceased to be capitalist, and profit-oriented. Forbidding persons from using valuable tips might amount to imposing a duty on individuals, however unconnected, to be one another’s keeper and to keep secrets which are not entrusted to them. This appears to be an imposition of morality. Law must be prepared to deal with the uncertainties and inconsistencies which underlie most issues of morality.

Keywords: Insider Trading, Morality, Investor Confidence