Insider trader sentenced to 6 months: New Zealand’s FMA

fma warning

Jeffrey Peter Honey was sentenced yesterday to six months home detention at the Auckland District Court, after pleading guilty to one charge of insider trading under section 243(1)(a) and section 244 Financial Markets Conduct Act. Mr Honey admitted to being an information insider advising and encouraging another person to trade, New Zealand’s Financial Markets Authority announced earlier today.

FMA’s General Counsel, Nick Kynoch, said:

Insider trading erodes confidence and harms the integrity of our markets. Where we find examples of this kind of misconduct we will take action and use our enforcement powers to uphold the law.

The insider trading charges relate to trading in shares of Eroad (NZX:ERD).

Mr Honey was a senior employee at Eroad when he sent text messages to another individual that contained confidential material information relating to Eroad’s performance in the period to 30 September 2015. Mr Honey also sent a text message suggesting the other individual sold Eroad shares. That individual then traded 15,000 Eroad shares.

The other individual is also a defendant and faces one charge of insider trading under section 241 Financial Markets Conduct Act – namely, information insider must not trade. That defendant is yet to appear before the Court and has interim name suppression until an application for permanent name suppression has been determined.

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