Ashford W. Meikle, Staff Reporter
Chairman of the JSE Roy Johnson (left), and General Manager Marlene Street at a recent briefing held at the JSE's Harbour Street office last November.
JAMAICA Stock Exchange (JSE) says that based on its initial investigation in trading of Dyoll stocks, some transactions require further probing. "We have not made a conclusion...we have done our investigation and we can say that there are transactions that need further probing," said general manager of the JSE, Marlene Street in an interview with Wednesday Business.
On March 1 the JSE said that it would "investigate trading in the shares of Dyoll Group Limited to determine whether any connected parties executed trades in the company's stock since the event, which led to 'material loss' and impairment of Dyoll's capital base." And two weeks ago the stock exchange advised, via a press release, that it had "released to the Financial Services Commission [FSC] a report detailing the findings of [JSE's] investigation." However, up to now it has not elaborated publicly on its investigations.
"One of the things you would look at is if directors most importantly sold shares. What you would want to look at is companies who did transactions and match it with directors in Dyoll and see if there are any related connection to directors and you would do the same thing with individuals and get behind the name," she told Wednesday Business.
However, the executive stopped just short of admitting that the JSE had detected insider trading. "We've given [the FSC] some information for them to determine...," Ms. Street said as she trailed off in her thoughts. She continued, "we look at the information and pass it on to the FSC... [but] we are not at all saying that they are insider trading. You can only conclude after proper investigation. We have done sufficient investigation for probing," she said.
But, even if insider trading is evident, the JSE cannot act against the guilty parties. The Financial Services Commission will assume that investigation. "This will be done by the FSC...that is outside of the JSE responsibility ... we don't have the legal authority. It could be further investigation of a criminal matter. "
And the JSE will not publicise its findings. "We don't release that information to the public ... that is a disclosure that the JSE doesn't do ... we have no rules or regulations to disclose that," said Ms. Street. She emphasised that the investigation and its results "are outside the public domain."
Continuing in her defence of the JSE's decision not to release the information, Ms. Street reflected that "the JSE is a self regulatory organisation (SRO) which means that it has its own sets of rules." But even though the JSE is a SRO, it is still "guided ...by the Company Act and the government laws, laws of the land as it relates to how we conduct business." Based on the general manager's argument, the JSE's unique position is clouded by its relationship with the FSC. "The FSC has oversight responsibility of the JSE ... while it does not regulate the JSE ... it ensures that we are compliant with our rules."
The JSE boss was adamant that "information released to the public should not damage persons' characters. It would be unwise and dangerous to release information that might be speculative. The FSC and the JSE has to use due diligence as it relates to insider trading."
She said that the JSE "will be working in conjunction [with] the FSC ... if the need our output. Where we have stopped [in our investigations] is where we have the scope to stop."
