The opprobrium of professional colleagues is as much a deterrent to wrongdoing as any formal sanction by the authorities.
Market watchdog needs to name and shame
The theory is that the opprobrium of professional colleagues is as much a deterrent to wrongdoing as any formal sanction by the authorities.
The action of the UAE's Securities and Commodities Authority (SCA) in banning Riad Kamal, the chief executive of Arabtec Holding, from buying shares for a period of six months for an apparent breach of trading regulations, could perhaps be seen as a welcome extension of that principle to the Emirates's stock markets.
Certainly it could be argued Mr Kamal has suffered as much from the adverse publicity of the past two days as from any material loss he will suffer from the trading ban. Reputation is all-important in business.
But the SCA's new-found toughness is rather blunted by the manner in which the news of Mr Kamal's punishment came out.
It became public information not through the actions of the authority, but through third parties who saw the SCA's verdict and leaked it to news organisations.
Even Mr Kamal was officially unaware of the verdict until yesterday, when he received formal written notification of the SCA's decision.
Two other facts must also be borne in mind before we rush to praise the SCA's new determination.
First, the transactions for which Mr Kamal received sanction occurred in May 2009.
While all market practitioners see the need for thoroughness in investigations, such a long period seems excessive in an apparently simple case.
Second, it has also emerged that 40 other cases of investigation and conclusion were undertaken by SCA in the past year.
None of these have been made public, neither in the fact of their occurring nor in the identities of the participants.
The regulator should be less reluctant to publicise the success of its efforts to root out market abuse. Full marks for determination, but only 5/10 for communication.