A new system to overhaul insider trading investigations is due to be agreed in the latest response from US regulators to growing concerns about the extent of illegal activity on global markets. The plan, which has been the subject of negotiations for more than a year, is likely to be submitted to the US Securities and Exchange Commission for approval as early as this week.

While the SEC will remain the main markets watchdog, the new system would reform the way stock exchanges, often the first lines of defence against illegal activity, handle cases they refer to the SEC.