The Securities and Exchange Surveillance Commission called on corporate executives and officers Friday to keep unannounced information secret even from close relatives and friends because insider trading cases surged in fiscal 2009.
In the year that ended in March, the securities trading watchdog recommended that the Financial Services Agency impose penalties in 38 insider trading cases, including 21 involving such people. That’s up from 17 and three cases, respectively, in fiscal 2008, and the previous record high of seven cases logged in the latter category in fiscal 2007.
The financial instruments and exchange law bans executives and employees of listed firms from using confidential information gleaned from their jobs to trade in stocks. Relatives, friends and acquaintances are also covered by the rule as primary recipients of information.
One case affected Futaba Industrial Co., an auto parts maker affiliated with Toyota Motor Corp. A Futaba executive became aware that an accounting scandal was brewing and advised his mother to sell all her Futaba shares before the price plunged. She sold 9,700 shares, the commission said.
At Hitachi Ltd., a brother of an executive assistant was found to have made about ¥10 million from stock trades that were based on unannounced information about a takeover bid.
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