The crash in the Stock Exchange in 2008 was caused by lack of regulation, insider trading and not global meltdown.

This assertion was made by the Principal Attorney and Director of the Centre for Legal Research and Strategy, Dr Wunmi Bewaji during a chat with journalists at the venue of a book launch by him in Lagos.

According to him, the book "Insider Trading in Developing Jurisdictions: Achieving an Effective Regulatory Regime," was a product of research work conducted by him and some of his colleagues at the University of Leeds School of Law in 2007.

Bewaji identified the problems of the capital market in developing countries, particularly Nigeria as lack of transparency, pervasive fraud in securities, high level of illiteracy and ignorance, price volatility, abnormal profit, among others.

"There is an unholy relationship between company directors and stock brokers. Stock brokers are not market makers. Why are they allowed to trade in the market on their own account?" he asked.

Bewaji said the major problem of the stock market was that of the enforcement of rules.

He said to bring sanity to the stock market there must be such measures as insider pre-emption restriction on insiders' holding, short-swing and freeze rule, private right of action and civil remedies.

He also called for financial education of investors and integrity which he said was the major thing that could restore stability to the stock market.