Regulators to deal with Japanese hedge fund in insider trade case 

A small Japanese hedge fund has made a rare challenge against financial regulators over a 2010 insider trading case, disputing a finding that one of its fund managers acted on an insider tip of a share offering by energy firm Inpex Corp.

The Securities and Exchange Surveillance Commission (SESC) previously found a fund manager at Stats Investment Management sold Inpex shares on insider information from a Nomura Securities salesman, based on the salesman’s admission of providing information to Stats as well as to Nissay Asset Management and Finno Wave Investments.

But the Nomura salesman, no longer employed by the brokerage but working for an affiliate of parent Nomura Holdings, told a public hearing on Monday that he did “not really remember” tipping off the fund manager.

Stats, with $300 million under management, said the manager had sold Inpex shares on July 6, 2010, two days before a vaguely-worded comment on an electronic messaging system that the SESC took to signal communication regarding Inpex.

Stats said it would take legal action against the government if the Financial Services Agency, based on the SESC’s recommendation, decides to fine the company.

Stats Chief Executive Shogo Sekimura said he was determined to protest the innocence of the fund manager, who has not been named as part of the proceedings. “Fund managers are treasures for a company like us, so we will fight to the end,” he told Reuters after the hearing. (Reporting by Emi Emoto; Writing by Ritsuko Ando; Editing by David Holmes)

 

Source: reuters

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