When the Alberta securities regulator brought charges against several executives at Grand Cache Coal Corp. because those executives sold company stock just before the company publicly disclosed negative news about its sales, this was an example of
A) cheque kiting.
B) insider trading.
C) misrepresentation of finances.
D) improper financial management.
E) whistle-blowing.

Question

Quizplus · Accepted Answer

Insider trading refers to using confidential and non-public information to gain an unfair advantage while trading securities. In this case, the executives at Grand Cache Coal Corp. sold company stock just before the negative news was disclosed, suggesting that they had access to non-public information and used it to sell their stock at a more favourable price. As a result, they were charged with insider trading.

When the Alberta Securities Regulator Brought Charges Against Several Executives