Market abuse may arise in circumstances where financial investors have been unreasonably disadvantaged, directly or indirectly, by others who:
- have used information which is not publicly available (insider dealing)
- have distorted the price-setting mechanism of financial instruments
- have disseminated false or misleading information.
Market Abuse is split into two different aspects (Under EU definitions):
- Insider dealing
- Where a person who has information not available to other investors (e.g. a Director with knowledge of a takeover bid) makes use of that information for personal gain.
- Market manipulation
- Where a person knowingly gives out false or misleading information (For instance about a company's financial circumstances) in order to influence the price of a share for personal gain;
In addition, Money laundering may be considered a form of market abuse.
Famous quotes containing the words market and/or abuse:
“A sentimentalist, my dear Darlington, is a man who sees an absurd value in everything, and doesn’t know the market price of any single thing.”
—Oscar Wilde (1854–1900)
“Playing games with agreed upon rules helps children learn to live by rules, establish the delicate balance between competition and cooperation, between fair play and justice and exploitation and abuse of these for personal gain. It helps them learn to manage the warmth of winning and the hurt of losing; it helps them to believe that there will be another chance to win the next time.”
—James P. Comer (20th century)