Advisors caught up in insider trading allegations

Advisors caught up in insider trading allegations

Advisors caught up in insider trading allegations

According to the decision, the panel found that Finkelstein tipped Azeff while in a special relationship with Masonite International Corp., and that Azeff, Bobrow, Miller and Cheng each purchased Masonite securities with knowledge of these facts, contrary to the public interest; and, that they acted contrary to the public interest by recommending the stock to clients.

A hearing on sanctions is expected to take place on May 21 and penalties could top $1-million for each of the six violations.

Despite their assertions, the panel concluded that Finkelstein was aware that material facts surrounding the deals with undisclosed and in three cases, the OSC found that he had direct knowledge, because he was a lawyer involved in the transaction. The panel also found that he that the deal would acquire a target.

In the three other transactions, it also found that Finkelstein had knowledge of the decision to acquire the target, although he was not working on the transactions, because he accessed deal documents between the time of the decision to acquire and the public announcement.

"On a balance of probabilities, we find that the purchase of MHM shares by Azeff and Bobrow, Miller and Cheng, was timely trading motivated by the [inside information] each of them received,” the report notes.

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  • Bob T 2015-03-27 12:13:23 PM
    I, for one, am pleased to see this action by the OSC. Insider trading is completely unacceptable. Not only does it affect the reputation of the markets but it continues to lead people to believe that there is some magical way of finding out what is happening before some others.
    The typical person coming to me with a tip has no idea that what they are doing is potentially illegal. If they really have knowledge that is based on information that is not available to the general public then they should not trade the security.
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