The term "insiders" refers to the officers and employees of a public company. Having inside information of a public company gives an individual power. It pays to follow the trading activity of insiders. The SEC along with a many public companies, have policies and procedures that allow insiders to sell shares in intervals. Lastly, understand that many penny stocks do not file financials and information is hard to come by. But some of the best penny stocks do provide this information and watching how insiders trade the stock can give you a solid indication on the direction of the company.
Consider this - when interviewing prospective agents whom you are planning to retain for the planned sale of your home, is it necessary for you to share privileged information under the context of agent - client relationship?
The insider information that provides answers to the motivations of a sale is your leverage in the negotiation with prospective home buyers. There is no question that you can share this privileged information to your agent once the working arrangement is already formalized. This includes sharing or using this information with an interested buyer of your property!
To put it bluntly - the real estate agent is working as an information collecting entity on the side. You are not obligated to disclose critical information in order for the agent to make a sound prognosis on how the prospective real estate deal should turn out. In 2007, several ex Morgan Stanley stock-loan desk workers allegedly took millions of dollars in kickbacks.
The traders involved in this case engaged in collusive loan transactions, routinely directed Morgan Stanley stock-loan business to two co-conspirators as "finders", and resulted in Morgan Stanley having to pay millions of "finder's fees" to companies controlled by the traders themselves and their friends. Last year, Randi Collotta, former Morgan Stanley compliance officer, pleaded guilty to insider-trading charges, while Jennifer Wang, former Morgan Stanley Vice President, was sentenced to prison for inside trading.