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ASX directors stand down after US short selling violations
Two directors of the Australian Stock Exchange (ASX) have resigned after being charged with short selling violations by the US financial services regulator The Securities and Exchange Commission (SEC).
The two directors, Russell Aboud and Shane Finemore, are the chair and managing partner of Manikay Partners, a New York-based hedge fund which was the subject of an enforcement action by the SEC.
The ASX announced their resignation this morning, stating that Finemore would not stand for re-election at the ASX's annual general meeting on 25 September. Aboud had been a non-executive independent director since July 2005 and Finemore had been a non-executive independent director since June 2007.
Their resignation follows an agreement to pay US$2.6 million to the SEC after it found that Manikay short sold two million shares in Citigroup in December 2009 and picked up US$1.65 million in profits from the trades.
Manikay now has 14 days to pay the SEC, with the US$2.6 million fine comprised of the profit from the trade, prejudgment interest of US$214,841 and a penalty of US$675,950.
The hedge fund was picked up with 22 other firms for short selling violations which have resulted in US$14.4 million in fines and penalties for the regulator.
AUTHOR
Jason Spits
Jason has been writing on financial services since 1999 and has worked for on a number of trade media titles in both a full time and freelance capacity. He joined Money Management and Super Review in 2013 in the role of Senior Journalist.
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