View from City Road: Whose job is insider dealing?

It is easy to see why the Treasury is so dismissive of pressure from the City for an enforcement agency to cover insider dealing and other market offences. Setting off this debate would undermine its plans to get the new insider dealing provisions of the Criminal Justice Bill through the committee stage with the minimum of further fuss.

The Bill has already had to be rewritten after a storm of protest from the City about the way it could undermine the traditional relationship between analysts, investors and companies.

There is something to be said for getting it on the statute book as quickly as possible and then worrying about enforcement.

But the fact is that the present system does work badly. The Stock Exchange is better than its critics admit at picking up irregular trading patterns and identifying the culprits, a job it should continue. But it has little real power to interrogate suspects or force production of documents.

The Department of Trade and Industry can appoint inspectors with wide powers to examine insider dealing allegations but this is slow and erratic and nothing like as effective as having a body with a police outlook on life, able to search premises and question suspects while the trail is hot.

That is not a job for the Stock Exchange. The only question is whether it should be for the Securities and Investments Board or the Serious Fraud Office.