Case Study 3

“The Consultant’s Leak”

Scenario:

Aung Ko, an external IT consultant working on Concordia’s system migration project, accidentally comes across a confidential internal document showing plans to acquire another local medical distributor.

He mentions it to his friend at a coffee shop, who then buys Concordia stock, expecting a price surge after the acquisition.

Issue:

Although Aung Ko is not a Concordia employee, he had access to insider information and disclosed it casually. His friend trading on that tip makes both parties legally exposed.

Under the law, external contractors with access to inside information are also considered insiders.

Takeaway:

Access = Responsibility. Even non-employees (consultants, auditors, lawyers) must protect confidential company information. A small conversation can result in unintentional insider trading violations.