American Insider Trading Law
The United States has been the leading country in prohibiting insider trading made on the basis of material non-public information. Thomas Newkirk and Melissa Robertson of the U.S. Securities and Exchange Commission (SEC) summarize the development of US insider trading laws. Insider trading has a base offense level of 8, which puts it in Zone A under the U.S. Sentencing Guidelines. This means that first-time offenders are eligible to receive probation rather than incarceration.
Members of the US Congress are not exempt from the laws that ban insider trading, but as they generally do not have a confidential or fiduciary relationship with the source of the information they receive and accordingly, they do not meet the definition of an "insider."
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