Which of the following is considered a type of market abuse?

Prepare for the CISI Regulatory Exam with engaging quizzes, detailed explanations, and tools to enhance understanding. Master regulatory frameworks and improve your readiness for a successful exam outcome!

Insider dealing is categorized as a type of market abuse because it involves trading based on non-public, material information about a company. This illegal practice undermines the integrity of the financial markets, as it creates an uneven playing field where those with insider knowledge can exploit that information to make profits or avoid losses, while other investors lack access to the same insights. The financial markets rely on transparency and fairness, and insider dealing erodes investor trust and confidence.

In contrast, regulatory compliance refers to an organization's efforts to adhere to laws and regulations pertinent to its operations, which is vital for the market’s proper functioning and does not constitute abuse. Market validation involves confirming the worth of a product or service in the market and is not considered abusive behavior. Similarly, capital restructuring pertains to the organization of a company's financial structure and does not engage in manipulative practices against market regulations.

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