CMF Proposes Stronger Penalties for Using Insider Information
26 diciembre 2019

The Financial Market Commission (CMF) has submitted a proposal to increase prison sentences for people using insider information on the stock market to the Ministry of Economy, in the context of the Executive’s presentation of its anti-abuse agenda on December 9.  

The CMF proposes to increase prison terms to 10 years and impose maximum economic sanctions on agents using insider information on the stock market. Currently, legislation envisages penalties ranging from 61 days to 5 years.

The CMF also intends to raise the maximum fine applied from 15,000 Unidades de Fomento (UF, for its acronym in Spanish), equivalent to US$ 420 million, to 200,000 UF (US$ 5.4 billion).

These measures arise from an analysis showing abuses in the financial market, a study which measured the degree to which share prices preempted announcements of mergers and acquisitions. The results showed that Chile is 55% ahead of schedule before any official corporate announcements.