The article from Asahi Shimbun elaborates on insider trading, particularly in the context of Japan's Financial Instruments and Exchange Act, which prohibits illicit trading of securities based on non-public, significant information about publicly listed companies. Insider trading typically involves corporate insiders who buy or sell stocks based on critical information regarding mergers, significant earnings revisions, or other material facts that can affect investment decisions. The laws are intended to maintain market fairness by preventing insiders from exploiting confidential information for their gain while placing ordinary investors at a disadvantage.

Moreover, the article highlights that the scope of regulation extends beyond just corporate executives or employees; it includes third parties who may receive important information, such as business partners. Activities such as "information transmission" and "transaction recommendation"—where insiders share crucial information or recommend specific stock trades—are also outlawed under these regulations. If found guilty, offenders may face fines or be required to forfeit illicit profits, and severe violations can result in criminal charges leading to imprisonment or substantial penalties.

Interestingly, the article cites a statistic from the Securities and Exchange Surveillance Commission (SESC) stating that since 2005, the most common violators of insider trading laws have not been corporate employees but rather their friends or colleagues who received privileged information, often shared inadvertently during social gatherings. The SESC warns that casual conversations during gatherings can easily lead to violations of insider trading laws, urging individuals to be cautious about discussing sensitive financial information in personal settings, as it can implicate not only the informant but also those who trade on that information.