Ch 21- Fraudulent Behaviour

Question 1

Which act defined insider dealing as a criminal offense ?

Answer 1

The criminal justice act 1993.

Question 2

What is the maximum sentence for insider dealing ( criminal offence ) ?

Answer 2

7 years of imprisonment and an unlimited fine.

Question 3

What is market abuse ?

Answer 3

Market abuse is a civil offence. Anything and everything related to manipulation, misleading information as well as insider dealing.

Question 4

The 3 processes of money laundering :

Answer 4

1. Placement
2. Layering
3. Integration
   It is a criminal offence.

Question 5

Which act currently monitors money laundering offenses ? What are the other categories of offence ?

Answer 5

It is regulated by the ‘Proceeds of crime act 2002’ .
The other offenses linked to money laundering are:
1. Laundering - concealing, disguising, converting etc etc..
2. Failure to report - suspicious activities must be reported.
3. Tipping off - disclosure of any kind.

Question 6

What are the Penalties for Money laundering , failure to report and tipping off ?

Answer 6

1. Money laundering - a maximum of 14 years of imprisonment and additional fines.
2. Failure to report - maximum of 5 years of imprisonment.
3. Tipping off - maximum of 2 years imprisonment.

Question 7

Fraudulent trading can be both a criminal and civil offence. True / false.

Answer 7

True.