Inside traders in the sights of new law
In Oliver Stone’s fabled 80’s film Wall Street, the character Gordon Gecko came to epitomize the publics perception of traders making billions with insider trading, as well as the lengths to which some would go to in order to get inside information on companies, with the memorable epithet “greed, for lack of a better word, is good,” still providing the backdrop against which the real Wall Street is seen by the general public.
In the film the law finally catches up with the insider trader, but in contemporary Russia those in the trading world have been far less likely to worry about being caught for insider trading, with existing laws considered weak and confusing, and policing virtually non existent. But after a decade of conjecture and negotiation a law dedicated to stamping out insider dealing is finally ready for presidential approval.
Oleg Vyugin, chairman of MDM bank, and former head of the Federal Financial Markets Service, says this step is vital for the proper function of the stock market, and has implications for the whole economy. But he adds that policing the law still needs to be addressed, and adds that Russian market regulator is currently too small to take on the task. With the court system also too complicated to make punitive sentencing a deterrence he believes a dedicated court and policing body is the answer.
“The usual improvement of the legal system needs a lot of time, because it’s a serious political task. To create some special body responsible for any issues connected with the stock market, like some special court, is a much easier step.”
According to recent research, in an anonymous poll, around 55 percent of people involved in the securities market admitted to the selective disclosure of information. Vegas Lex Lawyer Anna Ovcharova says the new law would bring the country a step closer to international norms and will enhance its reputation as a place to do business.
“Just another sign of our country to be a little civilized than previously.”
The government is working to turn Moscow into an international financial centre. New laws ensuring a greater degree of transparency, and surety for investors, are every bit as vital to that aim as the gleaming new business district.