Document Type : Science - Research (Islamic Finance Jurisprudence)

Authors

• seyed mohammad ali torabi ¹
• Mohammad Tahidi ²
• Golam Reza Mesbahi Moghadam ³

¹ Faculty of islamic study and management, imam sadiq university, Tehran, Iran

² Associate Professor, Financial Management, Department of Financial Management, Faculty of Islamic Studies and Management, Imam Sadiq University, Tehran, Iran

³ Professor, Faculty of Theology, Islamic Studies and Guidance, Imam Sadegh University, Tehran, Iran

Abstract

Introduction: Inside information is important and confidential information that, if publicly disclosed, would affect the price of securities or investors' decisions to trade securities. Individuals who use this information can buy securities at lower prices or sell them at higher prices before this information affects the price and, after the information is publicly disclosed, make a profit or prevent their loss.

Method: In this research, the multi-level ijtihad method has been used to analyze the insider trading. based on the method, first a thematic analysis conducted, and then the jurisprudence dimensions of the subject were identified and insider trading was analyzed from the perspective of individual and governmental jurisprudence. In the jurisprudence analysis, using a descriptive-analytical method, these transactions were examined and compared with various and related jurisprudence principals.In the next stage, challenging cases were consulted with jurists, and finally, the jurisprudential analysis was conducted along with the responses to the consultations in a focus group of economic jurisprudents.

Results: Based on research results the misrepresentation proves the option of cancellation, and fraud causes loss compensation. comparing these transactions with incorrect possession of deposits and betrayal of trust provides the possibility of dismissing the managers who conduct inside trading. Failure to observe justice and expediency with the prevalence of these transactions does not have an effect on the Transaction authenticity and leads to obligatory prohibition.

Conclusion: Based on the summary, insider trading is void and tabu at the level of individual jurisprudence based on the rules of incorrect possession of property and no loss principle and at the level of governmental jurisprudence based on the rules of preservation of system and no loss principle.

Keywords

• Insider trading
• Individual jurisprudence
• Governmental jurisprudence
• Capital market

Main Subjects

• Science - Research (Islamic Finance Jurisprudence)