Parliament

Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 

Commerce Minister's Failings Snare Prime Minister

Commerce Minister's Failings Snare Prime Minister

Thursday, September 27 2001 Stephen Franks Press Releases -- Commerce


ACT Commerce Spokesman Stephen Franks said today that Helen Clark is highly exposed to liability under New Zealand's insider trading laws for her advice to Air New Zealand shareholders.

Yesterday Mr Franks said that the process of due diligence is almost always a clear breach of insider trading law. "The Stock Exchange and the Securities Commission turn a blind eye to these breaches provided the directors can be sure the information will be kept confidential, and those getting the benefit of due diligence do not trade or tip. The directors of Air NZ have now lost that defence."

Having explored the issue further, Mr Franks a former member of the Securities Commission, said that even before the Prime Minister's blunder, the Government, Air NZ directors and senior management faced the prospect of liability. "They could have to pay up to three times the amount of any gain or loss made on share trading connected with statements made by any of them. After Helen Clark's statement the risks became very real.

"Even when due diligence is conducted to the highest ethical standards and people observe the rules, it remains unlawful. This is because the Government never fixed the definitions in our insider trading law. Minister Swain came to power vowing to reform insider trading law. Two years later we don't know what his changes will look like, and his statements only cover cosmetics. There is no indication the changes will cover the real problems.

"The law was introduced hastily in 1988 as a political response to the sharemarket crash. It was soon realised that the definitions caught normal market practices. The Labour Government at the time sneaked through a small 'technical' amendment to exempt the Government from some embarrassing liability, but refused to deal with the main problems for underwriters, analysts, and law abiding investors.

"The Securities Commission and Minister Swain's officials are well aware of the problem. I raised it with the Minister last year when his September 2000 discussion document failed to touch on the root problems with insider trading law and instead pumped only the populist 'solution' of criminalisation.

"It will serve the Government right if the most prominent public defendant before real reform turns out be his Prime Minister. Even the Stock Exchange and others who have been pushing for more fundamental reform might get some satisfaction, though less if the taxpayer has to pay the cost of defending the Prime Minister. She hasn't in the past seemed keen to meet her legal costs ," Mr Franks said.

For more information visit ACT online at http://www.act.org.nz or contact the ACT Parliamentary Office at act@parliament.govt.nz.

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Supreme Court: Worksafe Decision On Whittall Pike River Prosecution Unlawful

The question in issue on the appeal was whether WorkSafe New Zealand acted to give effect to an unlawful agreement of this nature when it offered no evidence on charges against Peter William Whittall for breaches of the Health and Safety in Employment Act 1992...

The Supreme Court... has found that the decision to offer no evidence was made under an unlawful agreement to stifle prosecution. It has granted a declaration to that effect. More>>

 

Cullen To Chair: Tax Working Group Terms Of Reference Announced

Finance Minister Grant Robertson and Revenue Minister Stuart Nash today announced the Terms of Reference for the Tax Working Group and that the Group will be chaired by Sir Michael Cullen. More>>

ALSO:

Gordon Campbell: On The New Pike River Agency (And The Air Strike Wing)

Much of the sympathy the public still feels for the families of the Pike River miners has been sustained by the sense that the previous government – let alone the mining company and the processes of receivership and litigation – has never dealt honestly, or fairly, with them. More>>

ALSO:

Not Going Swimmingly: Contractor Cut, New Dates For Christchurch Sports Centre

“As an incoming Minister, I have been conducting a thorough review of progress on the Anchor projects and to learn of a $75 million budget blowout on this project was very disappointing..." More>>

ALSO:

Tertiary: Allowances, Loan Living Costs To Get Boost

“From 1 January, student allowance base rates and the maximum amount students can borrow for living costs will rise by a net $50 a week,” says Education Minister Chris Hipkins... further adjusted from 1 April 2018 in line with any increase in the CPI. More>>

ALSO:

Foreign Affairs: Patrick Gower Interviews Jacinda Ardern

Prime Minister Jacinda Ardern says discussions have already begun on how to bring climate change refugees into New Zealand under a Pacific seasonal employment plan... More>>

ALSO:

Gordon Campbell: On The Centre Right’s Love Of ‘Nanny State’

You’d almost think it was 2005 again. That was a time when the rugged individualists of the centre-right were being beset by government regulations on the nature of light-bulbs, the size of shower heads, the junk food available at school tuck shops and other such essentials... More>>

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

Featured InfoPages

Opening the Election