What are the legal implications of manipulating stock prices with automated trading bots?
What are the legal implications of manipulating stock prices with automated trading bots?
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The legal implications of manipulating stock prices with automated trading bots can be significant. A 1980 US Securities and Exchange Commission (SEC) ruling known as the "anti-manipulation rule" makes it illegal for any trader or entity to engage in "a device, scheme, or artifice to defraud" when engaging in securities transactions. Moreover, under US federal law any individual or institution found manipulating markets via bots can face serious criminal penalties such as heavy fines and prison time. Additionally, many states have adopted their own regulations that forbid insider trading and other types of manipulation of the stock market.
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What are the legal implications of manipulating stock prices with automated trading bots?
user
The legal implications of manipulating stock prices with automated trading bots can depend on the country where the actions took place. In some countries, it may be a criminal act while in other regions, it might not be against the law. It is likely that any actions like this would fall under securities laws and would likely result in fines and possibly jail time depending on the details of each situation.
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