On 29 November 2017, ASIC banned Mr Simon Poidevin, of Sydney, from providing financial services for five years following an ASIC investigation into trading in the shares of DirectMoney Ltd ('DirectMoney'; ASX code: DM1).
Mr Poidevin, Managing Director of Corporate Broking at Bell Potter Securities Limited (Bell Potter), has been banned for five years due to his involvement in trading in DM1 shares between 14 July 2015 and 23 July 2015.
Bell Potter had been the manager and underwriter to a capital raising, resulting in DirectMoney being admitted to the ASX on 13 July 2015.
ASIC's investigation found that in the two weeks following the commencement of trading, Mr Poidevin took part in transactions carried out by Mr Damien Rodr – a Bell Potter Designated Trading Representative (DTR) (Mr Rodr) on Bell Potter's House Account, that had the effect of creating and maintaining an artificial price for DM1.
Appeal to AAT
On 30 November 2017, Mr Poidevin filed an application for review of the banning order made by ASIC in the Administrative Appeals Tribunal (AAT). Mr Poidevin also applied for a stay of ASIC's banning order.
AAT Stay Order - subject to conditions
On 7 February 2018, the AAT made orders staying ASIC's banning order until the AAT's decision on Mr Poidevin's review application comes into operation. The AAT stay orders are subject to the following conditions that apply for the duration of the AAT proceedings:
- Mr Poidevin will not communicate by any means with:
- designated trading representatives at Bell Potter Securities Limited ACN 006 390 772 (Bell Potter) or at any other firm; and
- any member of the Bell Potter Institutional Sales Division, wherever they are located.
- If Mr Poidevin has any knowledge of and involvement in transactions where Bell Potter is trading as principal, he will ensure that:
- he seeks prior approval for such transactions by the Managing Director or his delegate; and
- such transactions are only executed by the Head DTR (Designated Trading Representative) in accordance with Bell Potter's internal policy on trading as principal; and
- Mr Poidevin will actively and in good faith participate in a program of compliance training conducted by an appropriately qualified training provider with relevant industry expertise focused on compliance with the Corporations Act in respect of trading on markets.
ASIC's investigation into trading in the shares of DirectMoney is continuing.
Background
Mr Rodr
On 29 November 2017, Mr Rodr was banned by ASIC from providing financial services for four years under s920A of the Corporations Act following ASIC's investigation which found that Mr Rodr took part in transactions that had the effect of creating an artificial price for trading in DM1 shares (refer: 17-414MR).
On 20 December 2017, Mr Rodr lodged an application for review of ASIC's banning order in the AAT.
Bell Potter
On 16 November 2017, Bell Potter paid a penalty of $358,000 to comply with an infringement notice given to it by the Markets Disciplinary Panel ('the MDP'; refer: 17-387MR)
The infringement notice was issued by the MDP in relation to an alleged contravention of subsection 798H(1) of the Corporations Act, after the MDP found it had reasonable grounds to believe that Bell Potter had contravened Rule 5.7.1 and 5.11.1 of the ASIC Market Integrity Rules (ASX Market) 2010.
The infringement notice was issued for Bell Potter's alleged conduct in July 2015, for reasons including that it made bids for DM1 shares with the intention, and having the effect of, supporting the price of DM1 shares.
Bell Potter's compliance with the infringement notice is not an admission of guilt or liability, and Bell Potter is not taken to have contravened subsection 798H(1) of the Act.