Archive for the ‘Asia-Pacific’ Category

As The Autralian wrote today stockbrokers will find themselves facing fines as high as $1 million for serious market manipulation under new Australian Securities Exchange regulations in force from Monday.

The quadrupling of the maximum fine for serious disciplinary matters for brokers and futures traders, from the current limit of $250,000, is a consequence of a recent push by the ASX to bring the Australian fine regime into line with international practice.

The ASX has found itself in the firing line because of recent trading practices in the market downturn such as short selling and stock lending, which have led to calls for more disclosure of which sales are “short” and which stocks are borrowed. Short-selling involves selling shares the vendor does not own, most usually having borrowed stock to cover the position, with the aim of buying back shares at a lower price.

The new $1 million maximum fine represents a significant step up compared to the total of $570,000 in fines collected by the ASX disciplinary tribunal from broker members for the six months to the end of December and the total of $410,000 collected for the financial year ended June 30, 2007. The fines are potentially in addition to referrals by the ASX’s market supervision arm to the Australian Securities and Investments Commission for possible breaches of the Corporations Act such as insider trading, breaches of continuous disclosure and market manipulation. Read the whole story …

Two former employees of a Tokyo-based printing company’s branch face arrest for insider trading, according to sources at law enforcement authorities.

The Sapporo District Public Prosecutors Office is expected to arrest the two former workers, who worked at Takara Printing Co.’s Sapporo branch, early next week. Their names are still being withheld.

The two used the company’s in-house computer network that is closed to outsiders to obtain insider information on a corporate customer’s takeover bid, bought 100 million yen worth of shares of the firm’s stock, and sold them after the bid was officially announced, according to the sources. They allegedly gained tens of millions of yen in profits from the transactions.

EU regulators have often stressed that the obligation to appy proper anti market abuse systems and controls should not apply only to issuers but also to contractors involved in price-sensitive deals. Printing companies and their employees are often exposed to price-sensitive information abuse of which proves to be sometimes too tempting to resist. The above news published by Mainichi Daily News reflects that regulatory concerns in this area are grounded.

As we wrote last week, there are updates regarding Hong Kong’s high-profile insider scandal.

As Wall Street Journal wrote today: David Li, a prominent Hong Kong banker and legislator, resigned his seat in Hong Kong’s cabinet Saturday amid controversy over his alleged role in an insider-trading case involving shares of Dow Jones & Co.

Mr. Li took the responsibility and resigned from his position after settlement with the Securities and Exchange Commission to settle insider-trading charges.

We see that current European regulation and Market Abuse Directive principles are good guidelines for Asian and US Markets to follow and harmonize their insider regulation.

Asia Sentinel, a Hong Kong publication wrote today:
One of the territory’s most prominent figures is nailed in an insider trading scandal but it seems unlikely that he will be hurt by it. Hong Kong’s pretensions to be a well-regulated financial center must be regarded with a certain amount of disbelief if Bank of East Asia Chairman and CEO David Li hangs onto his government appointments, including his cabinet post as a member of the Executive Council, and his many directorships of public companies, including the South China Morning Post, in the wake of the US Securities and Exchange Commission’s decision last week to fine him heavily for insider trading. Read the whole story …

Lets hope that the “European” regulatory and ethical culture will be soon amended also in Asian countries.