Gee the Herald goes soft on their columnist today, suggesting that after copping a $1.5 million dollar fine from the FMA that Brian Gaynor’s Milford Asset Management merely took their eye off the ball..
Milford Asset Management’s directors have accepted they took their eye off the ball while a portfolio manager carried out alleged market manipulation that sparked a high-profile regulatory probe and a $1.5 million settlement with the Financial Markets Authority.
The FMA yesterday revealed the results of a lengthy investigation into trading activity at the Auckland-based investment firm, which has more than $3 billion under management, including KiwiSaver funds.
Milford has agreed to a $1.5 million settlement, $1.1 million of which will go to the Crown, with the balance covering the costs of the regulator’s probe.
The portfolio manager, whom the company and FMA will not name, is still facing enforcement action and was yesterday placed on extended leave.
Under the Financial Markets Conduct Act, someone convicted of market manipulation can be jailed or fined up to $500,000.
The headline is an understatement!
Pity the regulator was so soft. It should have been $15 million in fines.
If it comes out, as I expect it will, that the trader was skimming a margin to the house account, doing what is known in the trade as “bed & breakfast trading”, the Board will have known, as they will have seen the resulting profits.
It isn’t hard to work out who the “trader” is either…he is the only one missing from their web page and a quick check of cached copies of their website shows that. Read more »