1. 1 Regulation and market development Sisanda Mrwetyana

2. 2 OVERVIEW The need for regulation Historical background to our legislation South African approach to regulation & critical success factors Detection Investigation Enforcement

3. 3 South African approach to regulation & critical success factors The Insider Trading Act, 1999 The Securities Services Act, 2004

4. 4 South African approach to regulation & critical success factors Detection Investigation Enforcement

5. 5 Detection Key features for successful surveillance Reliability Constant surveillance Red flags Access to client information Flexibility Adaptability to new instruments

6. 6 Investigations Powers MOU’s Trading databases Avoid investigation by correspondence Powers to be clearly stipulated

7. 7 Enforcement: Criminal sanction In the hands of the NDPP 10 years/R50 million Jail major deterrent But difficult to prove

8. 8 The Civil Action - Liability1 Trader: Penalty - Profit - 100 000 300 000 400 000 Total

9. 9 The Civil Action - Liability2 Tipper Tippee PenaltyProfit Total 100 000 400 000300 000100 000 300 000 700 000 400 000 Total600 000100 000

10. 10 Persons who dealt in the opposite direction, on the same day, iow: the victims Offender Creating confidence

11. 11 Our activities to date Investigated 200 cases to date Took legal action in 29 Recovered R50million in penalties 1 500 victims benefited from distribution

12. 12 Name and shame Enforcement actions/settlements are published

13. 13 Directorate of Market Abuse Enforcement Committee Penalty Compensation Registrar of High Court Enforcement Committee (Administrative action)

14. 14 Keeping abreast of developments in the industry Keeping legislation up to date Maintaining good relationships with the industry

15. 15 Sharing a common vision with the exchange, right down to the details in the Rules is the most important success factor

16. 16