Insider trading in India – regulatory enforcement

Abstract

Purpose

The purpose of this paper is to study the effectiveness of insider trading enforcement actions in India and international dimensions.

Design/methodology/approach

The research is based on the insider trading regulations and amendments made during the period 1992-2015.

Findings

The notable observation of the study is the dearth of insider trading conviction and the paucity of prosecution for insider trading offences in India. It is difficult to resist the conclusion that surveillance and enforcement matter more than the drafting of the relevant statutes and regulations in emerging markets. Whereas, developed countries have a better record of prosecution than emerging markets.

Research limitations/implications

Future research may explore the factors that hinder effective regulation and recommend new methods to increase the impact of Securities and Exchange Board of India insider trading regulation.

Originality/value

The current paper presents guidance for the foreign institutional investors, regulators and market participants on insider trading regulation and prosecution in India.

Citation

Manchikatla, A.K. and Acharya, R.H. (2017), "Insider trading in India – regulatory enforcement", Journal of Financial Crime, Vol. 24 No. 1, pp. 48-55. https://doi.org/10.1108/JFC-12-2015-0075