That excuse won’t wash: the peril of buying shares if you don’t know your stuff

About three to four people in Denmark are being reported to the police every month by Finanstilsynet for breaking the rules when acquiring stock. Some could even face time in prison

More people in Denmark have been buying shares of late – for many it has been a sensible option given the banks’ negative interest rates on savings of over 100,000 kroner, which most Danish financial institutions have called time on this month.

This growth in amateur share trading– along with the growing popularity of online trading, which does not require a broker – is proving to be a lethal combination, according to the financial authority Finanstilsynet, which reveals it is compelled to discipline 30-40 traders every year for breaking the law, mostly because they do not know the rules, or how strict they are.

Anyone who breaks the rules runs the risk of getting fined, a criminal record or even a prison sentence –even though the value of their share portfolio may be comparatively small

Wary of wash trades
The main offence is ‘wash trades’ – when online traders sell shares to themselves.

According to Finanstilsynet head Jesper Berg, his organisation is compelled to report three to four traders to the police every month.

Berg is warning the public to be more careful and aware of the rules when buying shares.