Insider Trading And Investor Protection: Evaluating SEBI’s Enforcement Actions (2018– 2024)
- IJLLR Journal
- 36 minutes ago
- 2 min read
Tuhina Chaturvedi (Research Scholar (Law), Rabindranath Tagore University, Bhopal
Dr. Neelesh Sharma, Dean (Law), Rabindranath Tagore University, Bhopal
ABSTRACT
Insider trading poses one of the most persistent threats to the fairness and integrity of financial markets, undermining investor confidence and long- term capital formation. In India, the regulation of insider trading has evolved significantly, culminating in the SEBI (Prohibition of Insider Trading) Regulations, 2015, and their subsequent amendments in 2024, which reflect the regulator’s growing sensitivity to digital-era challenges. This paper examines the historical development of insider trading regulation in India, emphasizing the importance of investor protection, market fairness, and deterrence. It analyzes SEBI’s enforcement actions between 2018 and 2024, highlighting trends such as the detection of digital leaks through social media and messaging platforms, the role of corporate insiders and intermediaries, and the deployment of Structured Digital Databases (SDDs) in investigations. Comparative insights are drawn from the United States and European Union/United Kingdom frameworks, particularly with respect to algorithmic trading, financial influencers, and emerging asset classes such as cryptocurrencies and NFTs. The study underscores the limitations of current laws in addressing cross-border enforcement and digital asset classification, while proposing compliance and governance strategies involving algorithmic monitoring, social media disclosure norms, and strengthened platform accountability. Policy recommendations emphasize harmonization of insider trading definitions across traditional and digital assets, enhanced influencer obligations, and international cooperation. By integrating doctrinal legal analysis with case law study and comparative review, the paper contributes to the discourse on aligning India’s insider trading regime with global best practices, ensuring investor protection in increasingly digitalized markets.
Keywords: Insider trading; SEBI; Prohibition of Insider Trading Regulations; investor protection; social media; algorithmic trading; cryptocurrencies; NFTs; Structured Digital Database; compliance; global regulatory frameworks.
