Market Abuse: The Shadow in the Trading Floor | Community Health

Market abuse refers to the intentional manipulation of financial markets for personal gain, often through insider trading, false information, or other forms of deception. According to the European Securities and Markets Authority (ESMA), market abuse costs the global economy an estimated $200 billion annually. The most common forms of market abuse include insider trading, where individuals with access to confidential information use it to inform their investment decisions, and market manipulation, where traders artificially inflate or deflate stock prices. The fight against market abuse is led by regulatory bodies such as the Securities and Exchange Commission (SEC) in the US and the Financial Conduct Authority (FCA) in the UK. Notable cases of market abuse include the Enron scandal in 2001 and the Libor scandal in 2012. As the financial markets continue to evolve, the threat of market abuse remains a pressing concern, with the rise of cryptocurrencies and online trading platforms creating new avenues for manipulation and deception.