Canadian business press reports note that this week will see a hearing by the Ontario Securities Commission into allegations of insider trading at the Amaya online gambling group (now rebranded The Star Group) during David Baazov’s tenure three years ago as chief executive.
Several individuals are expected to appear at the hearing to explain their actions; although there are reports that one person accused in the allegations has already settled with the Commission.
The OSC hearing is distinct and separate from the criminal charges laid against Baazov and two other individuals by the Quebec securities regulator, the Autorité des marchés financiers (AMF), which are scheduled for court in November this year.
Baazov is reportedly accused of aiding in trades while possessing privileged information, influencing the market price of Amaya securities and communicating privileged information.
According to Quebec’s securities regulator, these acts occurred in the weeks leading up to the announcement that Amaya, then a modest gambling technology vendor, had struck a US$4.9-billion deal to acquire Oldford Group Ltd., owner of the PokerStars and Full Tilt Poker brands (see previous reports).
The individuals appearing before the OSC face allegations that they used privileged information about the PokerStars deal to buy shares before the official announcements were made, which drove the share price upward.
Whilst the OSC doesn’t have the punitive clout of the criminal courts, it can nevertheless make life uncomfortable for those it deems have behaved badly by imposing fines, cease trading orders and bans from serving as company officers or directors.
The OSC has recently been tightening up on its operations following claims that it was not forceful or effective enough.