Insider dealing: fraud in Islam?

Siti Faridah Abdul Jabbar

Journal of Financial Crime, 2012, vol. 19, issue 2, 140-148

Abstract: Purpose - The purpose of this paper is to examine whether insider dealing is fraud from the perspective of Islam. Design/methodology/approach - The paper uses analogy (qiyas) of the injunctions in the Qur'an and Sunnah and critical analysis of literature on Islam. Findings - The paper finds that insider dealing is fraud (taghrir) in Islam and the defrauded party has the option to rescind the transaction for fraud (khiyar al‐tadlis) as well as for latent defect (khiyar al‐‘aib). Practical implications - The paper is practical as a source of reference in legislating laws relating to insider dealing particularly whereShari'ahis the principal source of law. Originality/value - The paper presents a novel attempt in establishing that insider dealing is fraud from the perspective of Islam.

Keywords: Crimes; Finance; Fraud; Insider dealing; Insider trading; Islam (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfcpps:13590791211220412

DOI: 10.1108/13590791211220412

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