The directors usually get a buying window in which they can purchase shares, but yes, if they bought a heap of shares and then dumped them quite quickly they'd be guilty of insider trading.
However, ASIC would have to prove that they made money on information which was not public knowledge. ASIC as a whole is fairly spineless.
The ASX will often issue "speeding tickets" if a stock goes UP with unusual volume without any announcements, however I have yet to see one issued when a stock heads south.