Lesson 3 of 5 · All lessons in this module
This lesson is part of the 2027 curriculum. You are following the 2026 curriculum, where it is not taught in this form. Switch if you are sitting the exam under the 2027 curriculum.
Lesson 3 of 5 · 16 min
Standard II(A) cases: tipping, experts and firm controls
Once you hold material nonpublic information, do not trade, do not tip, do not change a recommendation and send it to compliance; the cases test the many disguises acting and tipping can wear.
In short
- Act or cause others to act: your own trades, trades through family, funds or derivatives, tipping, and telling colleagues to trade all violate II(A).
- Tipping is a violation even if the recipient never trades, and relaying to relatives gets no exception.
- Believing an insider 'knows the law', or losing money, is no defence: you must check before you act.
- Experts may be paid and consulted, but you must not request or act on confidential information, and a signed no-MNPI agreement does not protect you.
- If you hold MNPI: seek public release, tell only compliance, take no action and leave current recommendations unchanged. A firewall works only if information crosses it through compliance.
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