3.2.1 Information Barriers
Section 15(g) of the Exchange Act requires registered broker-dealers to establish, maintain, and enforce written policies and procedures to prevent the misuse of material, nonpublic information (MNPI) by the firm or its associated persons.
Information is material if there is a substantial likelihood that a reasonable investor would consider it important in deciding whether to buy, hold, or sell a security. Therefore, any information that could reasonably be expected to affect the price of the security is material. Nonpublic means the information is yet to be disclosed to the general marketplace. Information is considered to be available to the public only when it has been released to the public through appropriate channels, such as by means of a press release or a public statement from one of the corporation’s senior officers, and enough time has elapsed to permit the investment market to