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January 26, 2023

Ernst & Young Interns Made Fully Aware of Insider Trading’s Pitfalls

With full-time personnel already on notice, E&Y figured any interns not already familiar with insider trading should be made aware that material, non-public information about a client should not be used to trade securities. Nor should you pass it to your golfing buddy, local jeweler, or connection for hard-to-get concert tickets. 

A tipster sent us the Q&A below, saying "Got this in a newsletter from EY for interns." 

The takeaway being this — if any of you grasshoppers out there use insider knowledge in the ways mentioned above that can result in 1) the end of your career at Uncle Ernie and 2) an all expenses-paid holiday to Club Fed.

Insider trading: the hard facts
At EY, it will cost you your job – and you could end up in prison. As media reports of insider trading increase, we ask Q&RM Leader Victoria Cochrane for her views.
Q: What's insider trading?
VC: Buying or selling securities – stocks, shares or options – when you possess information that's not available to other investors and the public. This includes passing what you know to others, except those who need to know because they are working on the same engagement.
Q: Why is this important?
VC: Insider trading breaches our clients' trust and is a criminal offence. Our clients trust us to keep their confidential information private. It's vital to our business and each of us personally that we handle confidential information with great care. If you’re in any doubt about what constitutes confidential information, consult your engagement leader.
Q: Why are we seeing an increase in violations across the business world?
VC: It’s difficult to say, but there’s no doubt that regulators around the world are cracking down hard on this sort of activity. These high-profile incidents are a warning. We must all understand what’s expected of us.
Q: How are we protecting our business?
VC: Our Insider Trading Global Policy says it all. It applies to all of us and makes our obligation not to trade with insider information absolutely clear. Read it now if you want to know more about insider trading, who to contact if you're unsure about what to do or how the policy applies in different situations.
Q: What if I suspect something?
VC: Contact your Regional Q&RM team or General Counsel immediately. Or contact our EY/Ethics Hotline anonymously to report any concerns about ethical, legal or professional issues. There's only one thing you should not do, and that’s ignore it.
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