Legal Definitions - insider information

Definition: Insider information refers to information about a company's financial or market situation that is not available to the public. This information is obtained from a source within the company or a source that owes the company a duty to keep the information confidential.

Example: If a company is planning to release a new product, the employees who are working on the project may have insider information about the product's features, launch date, and marketing strategy. If they share this information with someone outside the company, it is considered insider information.

Explanation: The example illustrates how insider information can be obtained by employees who have access to confidential information about the company. If this information is shared with others who do not have access to it, it can be used for personal gain, which is illegal and unethical.