insider trading

Here is the strange part. The information itself is not the crime. A managing director knowing that her company is about to announce a huge profit is not against the law, that is simply her job. The crime happens the moment she uses that secret to buy shares before the news reaches everyone else, or tells her cousin to do so.

Think about the Nigerian Exchange for a second. If someone on the board of a listed bank learns, before the rest of Lagos does, that the bank is about to declare an unexpected loss, and calmly sells his shares that same afternoon before the price crashes, that is insider trading. He has used a private advantage that other shareholders paid the same price to be denied.

The reason it matters is fairness, more than rules for the sake of rules. Millions of ordinary people, a teacher in Enugu buying shares through her pension fund, a Nigerian nurse in Manchester sending money home partly invested in Nigerian equities, trust that the market treats everyone's ₦50,000 the same as anyone else's ₦50,000. Insider trading calmly breaks that promise while looking, from the outside, like an ordinary trade.

In the United Kingdom, the Financial Conduct Authority treats this so seriously that people have gone to prison for it, sometimes over trades worth far less than you would expect. In Nigeria, the Securities and Exchange Commission and the Exchange itself watch for unusual trading patterns right before big announcements, because that timing is often the giveaway.

It is one of those crimes where the evidence is almost always circumstantial. Nobody confesses. Investigators simply ask one question again and again. Why did this person trade exactly this much, exactly now, right before everyone else found out?