So, what is the criminal charge of stock market manipulation? and how is this offense specifically regulated under the law?
According to Clause 2, Article 3 of Decree No. 156/2020/NĐ-CP:
“Stock market manipulation” refers to the performance of acts prohibited in securities activities and the securities market as stipulated in Clause 3, Article 12 of the Law on Securities, including one, some, or all of the following acts:
a) Using one or more trading accounts of oneself or of others, or colluding to continuously buy and sell securities in order to create artificial supply and demand;
b) Placing buy and sell orders for the same type of securities on the same trading day, or colluding in transactions without actual transfer of ownership, or with ownership merely revolving among members of a group, in order to create artificial prices or supply and demand;
c) Continuously buying or selling securities in a dominant volume at the opening or closing of the market to create new opening or closing prices for such securities;
d) Trading securities through collusion or inducement of others to continuously place buy and sell orders, thereby significantly affecting supply, demand, and securities prices, thus manipulating securities prices;
đ) Giving opinions directly or indirectly through mass media about a type of securities or an issuing organization in order to influence the price of such securities after having already conducted transactions and held positions in them;
e) Using other methods or performing other trading acts, or combining such acts with spreading false rumors or disclosing misleading information to the public, in order to create artificial supply and demand or manipulate securities prices.
Criminal liability under the 2015 Penal Code:
Any person who commits one of the following acts and gains illegal profits from VND 500,000,000 to under VND 1,500,000,000, or causes damage to investors from VND 1,000,000,000 to under VND 3,000,000,000, shall be subject to a fine of between VND 500,000,000 and VND 2,000,000,000, or imprisonment from 06 months to 03 years:
a) Using one or more trading accounts of oneself or others, or colluding to continuously buy and sell securities in order to create artificial supply and demand;
b) Colluding with others to place buy and sell orders for the same type of securities on the same trading day, or engaging in transactions that do not result in an actual transfer of ownership, or where ownership merely circulates among members of a group, in order to create artificial prices or supply and demand;
c) Continuously buying or selling securities in dominant volumes at the market’s opening or closing, in order to establish new opening or closing prices;
d) Trading securities through collusion or inducement of others to continuously place buy and sell orders, significantly affecting supply, demand, and prices, thereby manipulating securities prices;
đ) Giving opinions directly or indirectly via mass media on a type of securities or an issuing organization in order to influence prices after having already traded and held positions in such securities;
e) Using other methods or performing other trading acts to create artificial supply and demand or manipulate securities prices.
If the offense falls under one of the following circumstances, the offender shall be fined from VND 2,000,000,000 to VND 4,000,000,000 or sentenced to imprisonment from 02 years to 07 years:
a) Committed in an organized manner;
b) Illegal profits of VND 1,500,000,000 or more;
c) Causing damage to investors of VND 3,000,000,000 or more;
d) Dangerous recidivism.
The offender may also be subject to a fine of between VND 50,000,000 and VND 250,000,000, prohibition from holding certain positions, practicing certain professions, or performing certain jobs for a period of 01 to 05 years.
Liability of commercial legal entities:
If a commercial legal entity commits this crime, it shall be penalized as follows:
a) For acts under Clause 1 of this Article: a fine of between VND 2,000,000,000 and VND 5,000,000,000;
b) For acts under Clause 2 of this Article: a fine of between VND 5,000,000,000 and VND 10,000,000,000;
c) For cases falling under Article 79 of this Code: permanent suspension of operation;
d) A commercial legal entity may also be subject to an additional fine of between VND 500,000,000 and VND 2,000,000,000, prohibition from doing business, prohibition from operating in certain fields from 01 to 03 years, or prohibition from raising capital for 01 to 03 years.
Legal basis: Article 211 of the 2015 Penal Code.
