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Abstract
Much of the uproar about insider trading has focused concern on the wrong parties. Most of the attention has concentrated on the adverse effects of insider trading on traders - those individuals who sold while insiders were buying or who bought when insiders were selling. The parties more likely to be hurt by insider trading are the owners of companies, those insiders' employers that, for corporations, are the ongoing shareholders and society in general. Since the undesirable acts of employees can occur without transactions involving securities, any reforms may view the process of misusing proprietary information as embezzlement or theft. Holding insiders to a high ethical standard will result in a more efficient operation of the capital markets. The widespread use of proprietary information by employees for personal gain would leave potential investors with the feeling that the stock market is unfair.