Regulation and market development
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Transcript of Regulation and market development
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Regulation and market
development
Sisanda Mrwetyana
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OVERVIEW
•The need for regulation
•Historical background to our legislation
•South African approach to regulation & critical success factors
•Detection
•Investigation
•Enforcement
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South African approach to regulation & critical success factors
•The Insider Trading Act, 1999
•The Securities Services Act, 2004
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South African approach to regulation & critical success factors
•Detection
•Investigation
•Enforcement
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Detection
•Key features for successful surveillance
•Reliability
•Constant surveillance
•Red flags
•Access to client information
•Flexibility
•Adaptability to new instruments
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Investigations
•Powers
•MOU’s
•Trading databases
•Avoid investigation by correspondence
•Powers to be clearly stipulated
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Enforcement: Criminal sanction
•In the hands of the NDPP
•10 years/R50 million
•Jail major deterrent
• But difficult to prove
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The Civil Action - Liability1
Trader:
Penalty -
Profit - 100 000
300 000
400 000Total
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The Civil Action - Liability2
Tipper
Tippee
PenaltyProfit Total
100 000
400 000300 000100 000
300 000
700 000
400 000
Total 600 000100 000
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Persons who dealt in the opposite direction, on the same day, iow: the victims
Offender
Creating confidence
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Our activities to date
•Investigated 200 cases to date
•Took legal action in 29
•Recovered R50million in penalties
•1 500 victims benefited from distribution
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Name and shame
Enforcement actions/settlements are published
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Directorate of Market Abuse
Enforcement Committee•Penalty
•Compensation
Registrar of High Court
Enforcement Committee (Administrative action)
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•Keeping abreast of developments in the industry
•Keeping legislation up to date
•Maintaining good relationships with the industry
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Sharing a common vision with the exchange, right down to the details in the Rules is the most important success factor
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