According to the DMA (Directorate of Market Abuse) of the Financial Service Board (FSB), there is no evidence of insider trading linked to the recall of former Finance Minister Pravin Gordhan from an international financial roadshow in March.
“The DMA concluded that the trades under investigation in the Currency Futures Contracts prior to the news breaking on 27 March 2017 that the Finance Minister, Mr Pravin Gordhan, had been recalled from an international roadshow by President Zuma, were undertaken in the normal course of business by institutional investors who at the time that they traded had no prior knowledge that Mr Gordhan would be recalled from the roadshow,” clarified the DMA.
Other investigations still ongoing
In addition to investigating possible insider trading with regards to Gordhan’s recall, the DMA is in the process of investigating a number of other possible insider trading cases, involving securities from the likes of:
- Advanced Health Limited
- KAP Industrial Holdings Limited
- Kumba Iron Ore Limited
- SacOil Holdings Limited
- Times Media Group Limited
- Trans Hew Group Limited
- Lewis Group Limited
- Wheat Futures Contracts
There are also several cases of possible prohibited trading practices (market manipulation) being investigated. The companies included in these investigations are:
- SABMiller PLC
- The Foschini Group Limited
- Oakbay Resources and Energy Limited (The DMA stressed that the person being investigated and has been referred to the FSB Enforcement Committee is unrelated to Oakbay Resources and Energy Limited.)
- Lewis Group Limited
Solly Keetse, head of department for the DMA at the FSB clarified to Justmoney that with both of these types of investigations, they are looking at the trades in these companies’ stocks. This means that it is not necessarily the company directly involved in the investigation but the people associated with the stocks traded.
Furthermore, there are a number of cases of possible false or misleading reporting being investigated, including companies such as:
- African Dawn Capital Limited
- Alliance Mining Corporation Limited
- Lewis Group Limited
“With this offence it’s invariably companies or individuals associated with those companies being investigated for making false and misleading statements,” explained Keetse.
The DMA strives to conclude all cases within 12 months of registering the investigation, however, this will depend on the complexity of the case, noted Keetse.
In the event that the parties involved in the investigations are found guilty, Keetse revealed that the DMA’s mandate is to refer the guilty party to the Enforcement Committee of the FSB for enforcement action to be taken against the guilty party.