[Direct answer]In the Beijing area, there are three channels for reporting: reporting to the China Securities Regulatory Commission and its dispatched agencies (hotline 12386 or written materials); reporting abnormal trading clues to the stock exchange; and reporting suspected crimes to the public security organ. The more specific and convincing the reporting materials are, the better — including the content of insider information, the identity of the insiders, the abnormality of the transaction (the coincidence of the time of establishing a position with the time of forming the information), and the evidence of accounts and relationship chains. The whistleblower's information will be kept confidential according to law, and there is a reward mechanism for major clues; after the supervision confirms the facts, the illegal gains will be confiscated and fines will be imposed, and those who commit crimes will be transferred to the judicial authorities for criminal prosecution.

1. Problem background and typical scenarios

Before the restructuring announcement, there were precise ambushes in the accounts; before the performance crisis, executives' relatives liquidated their holdings; before the disclosure of good news, mysterious funds aggressively bought up shares in large quantities — the patterns of insider trading are clear at a glance on the candlestick chart. However, turning "something that seems fishy" into "proven illegal" requires evidence organization and reporting channels. Many investors and insiders don't dare to report, don't know where to report, and can't provide sufficient evidence to support a case when they do report. This article thoroughly explains the process of reporting insider trading.

II. Key points of contention

First, the identification framework for insider trading activities. Second, the selection of reporting channels and the organization of materials. Third, the protection and rewards for whistleblowers. Fourth, the connection between administrative investigations and criminal accountability.

III. Professional analysis by Henglue Lawyers

First Level: Identification Framework The *Securities Law of the People's Republic of China* prohibits insiders and those who illegally obtain insider information from engaging in securities transactions using such information. Insider information refers to undisclosed information related to the issuer's operations, finances, or that could significantly impact the market price of the issuer's securities (such as mergers and acquisitions, major investments, dramatic changes in performance, and guarantees for large-scale debt defaults). Insiders include board members, controlling shareholders, actual controllers, and individuals with access to information through their positions, as well as their immediate family members. The identification logic is "insider knowledge + abnormal transactions + coinciding timing" – building a position and selling during sensitive periods, unusual transaction patterns and funding sources, or contact with insiders. Once the evidence chain is closed, identification can be confirmed. The accounts of insiders' spouses and close relatives are a key focus of regulatory big data scans. Second Level: Reporting Channels The CSRC's 12386 service hotline can be used for inquiries and tip-offs, while written reports submitted to the CSRC and its local offices (inspection departments) are more formal. In addition to the exchange's monitoring of abnormal transactions, investors can report specific clues to the exchange's market supervision department. For suspected criminal offenses (serious insider trading crimes), reports should be filed directly with the public security organ's economic investigation department. Administrative and criminal reporting can proceed concurrently, with the regulatory decision on administrative penalties serving as important evidence in criminal proceedings. Third Level: Protection and Incentives Regulators keep whistleblowers' identities confidential and allow anonymous reporting, while providing more comprehensive feedback for real-name reports. The *Interim Regulations on the Reporting of Securities and Futures Violations* establish reward mechanisms for significant leads, with first-tier rewards capped at a certain percentage of the confiscated funds. Whistleblowing is not a high-risk action of "offending others"; the system has designed protective and incentive measures. However, it's important to ensure the authenticity of reports, as false accusations carry legal liability. Fourth Level: Legal Consequences Administrative responsibilities – ordering the disposal of illegally held securities, confiscating illegal gains, and imposing fines of not less than one but not more than ten times the amount of illegal gains. For lack of illegal gains or insufficient amounts, fixed fines apply. Criminal responsibilities – Article 180 of the *Criminal Law of the People's Republic of China* on insider trading, with severe circumstances punishable by up to five years' imprisonment or criminal detention and fines, and particularly severe circumstances punishable by five to ten years' imprisonment and fines. Civil responsibilities – the Securities Law explicitly states that insider trading causing losses to investors should bear compensation liability, but the threshold for proving causality in individual cases is high, requiring professional assessments for claims. Currently, administrative and criminal procedures remain the primary avenues for accountability.The fifth layer, from the perspective of corporate internal control: For listed companies and companies planning to go public—the insider information disclosure system must be implemented (registration scope, confidentiality agreements, and declarations of transactions during sensitive periods), and information control before restructuring and delisting is a key focus of regulatory inspections; For institutional investors—firewalls between research transactions and insider information, and a declaration system for employees' relatives' accounts; Once involved in insider trading investigations (whether as suspects or witnesses), it is essential to engage professional lawyers to handle the proceedings as soon as possible. Once the window for making statements and defenses is missed, there will be no second chance.

IV. Practical suggestions and legal basis

The first step is to identify the behavior: Preliminarily judge it based on three dimensions: the scope of insiders, the sensitive period of information, and the abnormality of transactions. The second step is to collect evidence: Compile a time-point comparison table, account abnormalities, and a set of materials related to the chain of relationships. The third step is to select channels: Administrative reporting, exchange feedback, and criminal reporting according to the circumstances. The fourth step is to ensure safety: Choose between real-name or anonymous reporting based on risk tolerance, and the content must be true. Main legal basis: Articles 50 to 53 and Article 191 of the Securities Law of the People's Republic of China, Article 180 of the Criminal Law of the People's Republic of China, and the Interim Regulations on the Reporting of Illegal Activities in Securities and Futures Markets; the specific application shall be subject to the currently effective regulations.

5. Henglu Law Firm's Reminder

Three key points for reporting insider trading: The coincidence of timing and the chain of relationships are the core evidence chain for identification; the three channels of the China Securities Regulatory Commission, stock exchanges, and public security economic investigation departments are used in combination according to the circumstances; whistleblowers are protected by confidentiality and reward systems, but the authenticity of the materials is the bottom line. For reports of securities violations and financial disputes, you can seek assistance through the following channels:\nFinancial capital and cross-border transactions involving foreign entities.We provide a comprehensive solution for services, which involves the control of insider information and compliance within the enterprise, and the two can be integrated with each otherBusiness and contract disputes in enterprisesFor reference, you can refer to the procedures for dealing with individual cases in the plate sectionSpecialised legal servicesFor plates involving the recovery and enforcement of illegal proceeds, you can refer to the following for reference.Creditor's rights and debts, and enforcement cases板块。

VI. Frequently Asked Questions

Q1: Will reporting insider trading expose myself?

The supervision authority shall keep the whistleblower's information confidential in accordance with the law, and whistleblowing can be done anonymously. There is a reward mechanism for significant clues, and the system is designed to provide protection.

Q2: What constitutes insider information?

Information that has a significant impact on securities prices and has not yet been made public, such as mergers and acquisitions, major changes in performance, and major guarantees and debt defaults.

Q3: Does a spouse of an insider buying and selling stocks constitute insider trading?

The abnormal transactions of close associates during sensitive periods are a key focus of supervision, and they may be deemed to have jointly violated the law or illegally obtained information for trading purposes in accordance with the presumption rules.

Q4: How long will it take to get the results after reporting a problem?

Depending on the complexity of the case, the regulatory authority will provide feedback on the acceptance of the case. The investigation and handling period for major cases is longer, and regular follow-ups can be conducted.

Q5: Can victims of insider trading file a claim for compensation?

The Securities Law stipulates that insiders who engage in insider trading and cause losses shall be liable for compensation, but the threshold for determining the causality of individual cases is high. It is recommended to conduct a professional evaluation before deciding whether to claim compensation.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →Financial capital legal services·Beijing Henglue Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.