Autorité des marchés financiers (AMF), known to be the security regulator of the Canadian province of Quebec, revealed today that it has filed 23 charges, following a trading investigation into gambling operator Amaya Inc., its CEO David Baazov, and the $4.9-billion deal for the acquisition of the Rational Group, owner of PokerStars and Full Tilt.
Mr. Baazov himself is facing five different charges. Amaya’s founder and CEO has allegedly aided with trades while being in possession of confidential information about the company, influenced or at least tried to influence the market price of Amaya securities, and communicated privileged company information, the AMF said in a statement from today.
The investigation was launched several months after Amaya completed the $4.9-billion acquisition of PokerStars and Full Tilt. People with more knowledge of the matter pointed out this has been the biggest such investigation in Canada’s history.
The AMF noted that Mr. Baazov and the rest of the respondents have used privileged information regarding Amaya’s securities over the period from December 2013 to June 2014 for trading purposes. Several respondents have also allegedly conspired to commit together a number of the offenses listed by the regulator.
The AMF said in its statement from earlier today that the respondents, if found guilty, would be subjected to “stiff fines” as well as prison terms.
Commenting on the matter, Louis Morisset, President and CEO of the regulator, said that the suppression of market manipulation and illicit insider trading has turned into a top priority for the AMF. The official noted such conduct puts markets’ integrity at risk and deeply affects public confidence in the regulator.
Amaya and Mr. Baazov released a statement, following AMF’s announcement that the executive has been investigated. He said that all allegations are false and that he plans to contest them.
On February 1, 2016, Mr. Baazov announced that he intended to make an all-cash proposal for the acquisition of Amaya at a price of C$21 per share. The official has not made an official offer to take the company he had himself founded private, but revealed today that he is still discussing the matter with his investor group and Amaya’s board so as for a successful transaction to take place in the months to come.
