Carnegie man jailed for insider trading
TT/The Local · 17 Oct 2007, 16:50
Published: 17 Oct 2007 16:50 GMT+02:00
The Carnegie employee, 56, was said by prosecutors to have leaked information about US pharmaceutical company GE Healthcare's bid for Sweden's Biacore to a friend. The friend, a 65-year-old man from Malmö, was also jailed for six months by Stockholm District Court.
Both men were found guilty of serious insider trading.
Prosecutor Robert Engstedt reacted positively to the news:
"I can only note that the court has shared my judgment that this should be regarded as a serious offence and that a jail sentence should therefore result," he said.
Engstedt said he had not read the judgment in full and would therefore not give a more detailed response for the time being. But he said the ruling was important, as it was the first time Sweden's new insider trading laws had been applied in court.
The 65-year-old Malmö man, who works in the offshore sector, made a total profit of nearly 700,000 kronor on share dealings in Biacore during the time around the GE Healthcare bid. News of the bid in June last year led shares in the company to shoot up.
The 65-year-old's defence counsel had told the court that it was widely known on the market that Biacore was a candidate for takeover and that around 230 people could have known about the prospect of a bid.
The court ruled that it was proven that the Carnegie employee had deliberately given information to the Malmö man to the effect that Biacore would be bought up, and that that information persuaded the Malmö man to buy shares in the company.
The court said that the Malmö man's knowledge of share trading was such that he would have understood that the information was confidential.
Sentencing each of the two men to six months in jail - the minimum sentence for serious insider trading - the judges said they had taken into account that neither man had previous convictions.
The judges continued:
"Through their crime they have seriously damaged confidence in the market for financial instruments, which in the long term, and if behaviour like theirs were more common, could cause serious economic damage to society."