What Is a “Chinese Wall” in Financial Compliance?

A "Chinese Wall" is a regulatory barrier or information control procedure implemented within a financial institution to prevent the flow of material non-public information between different departments. Its purpose is to mitigate conflicts of interest and prevent illegal activities like insider trading and front-running.

For a CEX, this means strictly separating employees who have access to the private order book (e.g. IT staff, market surveillance) from those who might trade or advise clients.