Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZX adviser cuts $10k settlement over dodgy Trade Me deal

NZX adviser cuts $10k settlement over dodgy Trade Me deal, keeps name secret

By Paul McBeth

Dec. 7 (BusinessDesk) - An unnamed adviser at a registered NZX participant firm will pay a $10,000 settlement to the market watchdog after getting found out on a backroom deal to get Trade Me shares when the online auction site was floated last year.

The adviser used a client to get their hands on 1,500 Trade Me shares in the initial public offering, when the stock was sold at $2.70 apiece. The partial float’s structure was unusual because the bookbuild was run before the offer document was registered.

Under NZX rules, employees in a trading participant need sign-off from their boss to buy or sell any listed securities, and aren't allowed to take part in a public offer.

The NZ Markets Disciplinary Tribunal agreed to settle with the adviser, provided they paid $10,000 into the discipline fund, and cover costs incurred by the regulator.

The adviser transferred cash to a client who then bought 1,500 shares in the float worth $4,050, which was then handed back to the adviser in an off-market transfer.

If the adviser had held on to the share parcel, they would have made a paper profit of $2,295 based on Trade Me's current trading price of $4.23, and have received $117 from a first-half dividend. The person could also have looked forward to some $207 in dividends from the next two halves if the auction site meets its forecasts.

Trade Me first listed in December 2011 on the NZX and ASX after Fairfax Media sold down its stake to first 66 percent. It subsequently sold down to 51 percent as it reaped available funds to help shore up its publishing empire. UBS New Zealand was the sole lead manager and underwriter of the float.

The watchdog said the mitigating circumstances for the adviser were that no clients suffered, the breach was a one-off offence, and the adviser owned up early and had already been disciplined by the firm.

The settlement comes as public confidence the country's capital markets has been dented by the investigation into David Ross's Ross Asset Management - a group of funds that have been described as bearing the hallmarks of a Ponzi scheme and putting almost $450 million of investors' cash at risk.

That has put financial advisers back under the microscope, with the Financial Markets Authority taking a look at advisers who recommended their clients join the fund.

The sector has gone through a complete overhaul through the introduction of minimum education and professional standards as policymakers sought to stamp out incompetence and unethical behaviour after several billion dollars of investor wealth was destroyed in the collapse of the country's finance sector.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Quotas: MPI Swoop On Suspected Fraudulent Fishing Activity

Ministry for Primary Industries (MPI) compliance officers swooped on a Hawkes Bay fishing enterprise today to secure evidence in an investigation into suspected fraudulent activity... “The investigation involves activity throughout the commercial supply chain – catching, landing, processing and exporting.” More>>

ALSO:

Scoop Business: Fonterra Slashes 2015 Milk Payout, Earnings Tumble 76%

Fonterra Cooperative Group cut its forecast 2015 milk price payout by about 12 percent, citing weaker global dairy prices and said there is a risk of further declines given strong global milk production. More>>

ALSO:

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news