Disclosure of Nonpublic Information: Regulation FD
In 2000 the SEC adopted Regulation Fair Disclosure (Regulation FD). Regulation FD attempts to curb the selective disclosure of material, nonpublic information by issuers. Selective disclosure not only degrades investor confidence in the integrity of the market, but it leads corporate managers, who may be currying favor with certain analysts or institutional investors, to treat market information as a commodity.
Regulation FD requires an issuer who intentionally discloses material information to someone outside the company to immediately disclose that information publicly. If the issuer discloses such information unintentionally, the issuer upon learning of the disclosure must promptly make it public, meaning within 24 hours or the commencement of the next day’s trading, whichever is