ASIC gives ASA 103k from Hochtief insider trading fine
December 17, 2016
Dear lawyers on the Mayne Report email list and a few other interested parties,
First up this morning, ASIC issued this press release at 6pm last night outlining an unprecedented penalties arrangement for German construction giant Hochtief after it admitted to insider trading on an attempted $60 million in share purchases in the old Leighton Holdings (now CIMIC), back in January 2014.
The Australian Shareholders' Association lodged the original complaint about Hochtief buying shares in Leighton shortly before releasing a better than expected profit and has been rewarded with what could be interpreted as a spotters fee of $103,400. This is to be invested into company monitoring and education to improve the knowledge and capability of retail investors.
ASA Chairman Diana D'Ambra said: “The ASA wrote to the ASX to alert them of a possible breach of the insider trading rules when we noticed Hochtief's increased shareholding, so we are very pleased with the outcome of ASIC's investigations and the Court's decision. We are also appreciative of ASIC's decision that such a significant contribution should be made to the ASA.”
“This case highlights the need for vigilance. We are proud of our role in monitoring corporate governance on behalf of our membership and the investing community. It is very satisfying to receive such recognition,” Mrs D'Ambra said.
Measured in today's dollars, ASA received a bigger contribution from the GIO class action settlement in 2003, but this is the first time a regulatory penalty has effectively been directed to the ASA. It just goes to show that assertive shareholder advocacy does pay.
The key facts of the matter were outlined in this Crikey story back in February this year.
This earlier ASIC press release also has links to the key documents and time line, including this fascinating agreed statement of facts.
It has taken a further 10 months for the Judge's decision to convict Hochtief and fine it $400,000 but it is a great result for the ASA.
Here is some of the early press coverage:
The Australian
Fairfax (Age and SMH)
The AFR
In another but quite separate legal development, I'm wrestling with what to about the Municipal Electoral Tribunal decision in relation to the vacancy and final councillor position at City of Melbourne.
The key information is outlined in this special email edition of The Mayne Report sent to local government types (not lawyers) at 6pm on Wednesday night.
I've got until next Thursday to decide whether to appeal the Tribunal decision to VCAT. The Electoral Commissioner Warwick Gately has already decided to appear as this document reveals. Balance of power at the City of Melbourne is at stake here, so it really does matter.
If any lawyer out there fancies giving a hand navigating the VCAT processes, please drop us a line by reply email. Once again, the key facts of the situation are outlined here and are well worth a read.
That's all for now.
Do ya best, Stephen Mayne
* The Mayne Report is an email newsletter and website which promotes transparency and good governance in the corporate, political and media worlds. It is published by Stephen Mayne, the founder of Crikey.com, shareholder advocate, ASA director and former City of Melbourne councillor. To unsubscribe from this email list, click here.
First up this morning, ASIC issued this press release at 6pm last night outlining an unprecedented penalties arrangement for German construction giant Hochtief after it admitted to insider trading on an attempted $60 million in share purchases in the old Leighton Holdings (now CIMIC), back in January 2014.
The Australian Shareholders' Association lodged the original complaint about Hochtief buying shares in Leighton shortly before releasing a better than expected profit and has been rewarded with what could be interpreted as a spotters fee of $103,400. This is to be invested into company monitoring and education to improve the knowledge and capability of retail investors.
ASA Chairman Diana D'Ambra said: “The ASA wrote to the ASX to alert them of a possible breach of the insider trading rules when we noticed Hochtief's increased shareholding, so we are very pleased with the outcome of ASIC's investigations and the Court's decision. We are also appreciative of ASIC's decision that such a significant contribution should be made to the ASA.”
“This case highlights the need for vigilance. We are proud of our role in monitoring corporate governance on behalf of our membership and the investing community. It is very satisfying to receive such recognition,” Mrs D'Ambra said.
Measured in today's dollars, ASA received a bigger contribution from the GIO class action settlement in 2003, but this is the first time a regulatory penalty has effectively been directed to the ASA. It just goes to show that assertive shareholder advocacy does pay.
The key facts of the matter were outlined in this Crikey story back in February this year.
This earlier ASIC press release also has links to the key documents and time line, including this fascinating agreed statement of facts.
It has taken a further 10 months for the Judge's decision to convict Hochtief and fine it $400,000 but it is a great result for the ASA.
Here is some of the early press coverage:
The Australian
Fairfax (Age and SMH)
The AFR
In another but quite separate legal development, I'm wrestling with what to about the Municipal Electoral Tribunal decision in relation to the vacancy and final councillor position at City of Melbourne.
The key information is outlined in this special email edition of The Mayne Report sent to local government types (not lawyers) at 6pm on Wednesday night.
I've got until next Thursday to decide whether to appeal the Tribunal decision to VCAT. The Electoral Commissioner Warwick Gately has already decided to appear as this document reveals. Balance of power at the City of Melbourne is at stake here, so it really does matter.
If any lawyer out there fancies giving a hand navigating the VCAT processes, please drop us a line by reply email. Once again, the key facts of the situation are outlined here and are well worth a read.
That's all for now.
Do ya best, Stephen Mayne
* The Mayne Report is an email newsletter and website which promotes transparency and good governance in the corporate, political and media worlds. It is published by Stephen Mayne, the founder of Crikey.com, shareholder advocate, ASA director and former City of Melbourne councillor. To unsubscribe from this email list, click here.