What are the potential penalties for insider trading under CSRC regulations?

The penalties for insider trading under CSRC regulations are particularly stringent due to the severe impact that such activities have on market integrity and investor confidence. The correct answer highlights that individuals found guilty of insider trading may face fines, imprisonment, and suspension from trading.

Fines serve as a financial deterrent, aimed at punishing offenders and discouraging further violations. In addition to fines, imprisonment is a crucial component of the penalties, reflecting the seriousness of insider trading as a criminal offense. By enforcing prison sentences, regulators signal the message that insider trading is not merely a regulatory issue but a criminal act that undermines the fairness of financial markets.

Suspension from trading complements these punishments by preventing offenders from participating in the markets, thus protecting other investors and maintaining market integrity. This measure ensures that individuals who have engaged in unethical trading practices no longer have the same access to manipulate the market.

In contrast, the other options suggest alternatives that lack the rigor and seriousness associated with insider trading violations. For instance, warnings and temporary suspensions do not align with the typical consequences for severe offenses like insider trading, which necessitate stricter actions. Similarly, community service and training, while beneficial in certain contexts, are insufficient to address the gravity of misconduct in financial markets.