Wall-Crossing

Firms such as investment banks keep a barrier between staff who hold inside information and those who trade or advise the public. Sometimes a person on the public side must be told, for example an investor whose view is needed before a share placing or a bond deal. Wall-crossing is the formal process for that. Compliance approves the request, the person is told what they will hear is confidential and that they must not trade or pass it on, they agree to this, and they are recorded on the insider list. A restriction usually goes on the relevant name until the information is public or stale. Informal chatter without these steps is the failure to avoid. Reviewers later ask to see the approval, the warning given and the insider-list entry; a gap in any one weakens the firm's position if the trading is questioned.

Ahead of a large share placing, a broker's deal team wants the view of one major investor. Compliance approves the approach, and the investor's manager agrees by phone to keep the news confidential and not to trade. The call is recorded, the investor goes on the insider list and the stock is restricted.