FSA clamps down on insider dealing - or does it?

In recent days the FSA, the British Financial Services Authority, has conducted a series of well-publicised arrests of market professionals suspected of illegal insider trading. This may well be seen as an indication that the authorities have a firm grip on insider dealing but we would caution that clamping down on this practice is far from easy. Small players trading for their personal account may well be netted by increased supervision but the really big fish in the pond are institutions, especially hedge funds, that can easily mask insider trades among the multitude of trades they conduct on a daily basis.