Five people, including Fred Ingebrigtsen, the founder of the Scandinavian investment house Acta, are under investigation in what police on Monday called one of Norway’s biggest insider trading cases.
According to police four men, one woman and two companies face preliminary charges of illegal transactions with Acta shares worth 100 million kroner (US$20 million) as part of an organized crime network.
Ingebrigtsen, is charged with misusing inside information about Acta by sharing it with other defendants. All of them allegedly enriched themselves by using the information to make timely and fortunate share transactions.
The alleged insider trading involved Acta shares worth around NOK 100 million, making it Norway’s largest insider trading case to date.
Police and financial authorities in Norway reportedly have been investigating the case since February, when the Norwegian securities regulation agency (Kredittilsynet) reported its own suspicions to police. A conviction for insider trading as part of an organized crime network carries a maximum sentence of 11 years in prison.
Olav Braaten, defense attorney for Ingebrigtsen, nonetheless said his client was “shocked” by the charges against him, and by police raids at Acta offices and the homes of those charged. “He (Ingebrigtsen) says he hasn’t given insider information to anyone,” Braaten told newspaper Aftenposten, adding that several of the share transactions involved are more than three years old.
The raids and charges sent Acta’s stock into a steep dive, on top of heavy losses last week and a 57 drop in share value since New Year. The company already had suffered bad publicity and a rebuke from Norway’s finance minister after Aftenposten reported how Acta had engaged in aggressive marketing aimed at potentially vulnerable retirees.
Ingebrigtsen himself has been pressured by his creditors to sell all his own Acta shares. A report to the Oslo Stock Exchange Tuesday morning said that Ingebrigtsen had sold off the rest of his shares for NOK 8.50. That’s down from nearly NOK 40 per share in February of last year.