As another commenter pointed out, the victim is the public's trust in the financial market. With transactions between private entities, information asymmetry is a normal part of life. But if you want to be able to sell your shares on a public market, the public first needs to trust that you won't screw them over. That trust is a public good worthy of government protection, just like we have government agencies to protecting clean air and fair elections.
I simply disagree. The sale itself is all the information the market needs. I don't care about insider trading and I don't need the government's protection for it.
