Insider trading convictions help boost ASIC bottom line

Insider trading convictions and misconduct reports lifted last year, according to the Australian Securities and Investment’s Commission yearly report, which showed a 7% lift in revenue for the Government.

The ASIC report, released yesterday, shows six people were sentenced to terms of imprisonment on insider trading or market charges over the course of the year.

These were: Jeffrey Bateson, Newton Chan, Andrew Dalzell, Oswyn de Silva, John Hartman and Tamara Newing.

Hartman is appealing after being sentenced to 4.5 years in prison, with a minimum of three years for 25 charges. He also forfeited $1.57 million to the Commonwealth.

The number of convictions was 25, with the matters involving alleged insider trading and market manipulation are before the court, ASIC says.

In his introduction to the annual report, chairman Greg Medcraft said ASIC had processed 15,634 reports of misconduct among businesses and licensees, up 17% from the previous year. Twenty-eight percent were escalated for compliance, investigation or surveillance, it said.

ASIC also returned about $3.4 million in unclaimed monies to 1,198 claimants, Medcraft said.

The number of people or companies banned from providing financial services or consumer credit rose by 56% to 64 over the course of the year, compared with 2009-10, ASIC said.

The report showed that ASIC received $324 million in appropriation revenue, compared with $370 million in 2009-10, but collected 6% more in fees and charges, partly because of fee indexation increases.

ASIC expenses dropped by $2 million to $385 million for the year.

The regulator also drew attention to high-profile market integrity and consumer protection cases throughout the year, namely the jailing of Chartwell Enterprises director Graeme Hoy, who pleaded guilty to 44 deception charges regarding almost $22 million and to three charges under the Corporations Act. He was sentenced to 13 years and nine months imprisonment.

Action was also taken against employees of Fincorp, Firewpower Holdings Group, Opes Prime Stockbroking, Sonray Capital Markets, Trio Capital, Westpoint and Storm Financial.