When does private corporate information turn into illegal insider trading?

Private corporate information turns into illegal insider trading when an individual, such as an employee or executive, buys or sells a company's stock based on non-public, material information that could influence an investor's decision. This includes any significant news about the company, such as earnings reports, mergers, or acquisitions. Engaging in such trading before the information is publicly disclosed violates securities laws, as it undermines market integrity and fairness. Legal consequences can include fines and imprisonment for those found guilty of insider trading.