Former Macquarie Bank portfolio manager Oswyn de Silva has pleaded guilty to insider trading on 12 occasions which amounted to more than $1.4 million in gross profit, an ASIC investigation has found.
While employed as a portfolio manager and associate director for Macquarie Investment Management (MIML), ASIC alleged that between December 2006 and April 2007 de Silva acquired shares and contracts for difference (CFDs) in respect of eight entities listed on the Singapore Exchange while possessing inside information.
At the time he acquired the shares and CFDs, de Silva knew that MIML intended to acquire large volumes of the same securities and knew, or ought reasonably to have known, that MIML's acquisitions would be likely to cause the price of the securities, and the value of the CFDs, to increase.
Shortly after acquiring the securities and CFDs he disposed of them for substantial profits, often selling the securities directly to MIML.
The gross profit made by de Silva from this type of insider trading - which is commonly known as "front running" - was $1,412,975.
The matter was initially referred to ASIC by the Monetary Authority of Singapore (the MAS), and the regulator has acknowledged the ongoing assistance of the MAS and Macquarie Bank during its investigation.
The charge against de Silva carries a maximum penalty of five years' imprisonment, a $220,000 fine, or both.
De Silva did not apply for bail and the matter returns to the Sydney Central Local Court on 29 September 2010.
ASIC's civil penalty proceedings against de Silva in the Supreme Court of New South Wales have been automatically stayed as a result of this criminal action.
