Sabman,
The ASX is nothing short of the Wild West. I Hope the irony isn’t lost on them that the biggest fraud in Australian history was perpetrated by the regulator! Every single Australian with a superannuation account is out of pocket due to the regulator deliberately not enforcing the laws of this country. How many people have served the 15 years gaol stipulated for breaches of s1041 of the Corps Act? Zero! A crime must never have been committed!
Don’t take my word for it, just look at the results of the parliamentary inquiry chaired by Andrew Bragg - they investigated less than 1% of reports of market manipulation and of those 1% investigated only 8% (from memory) resulted in a “successful” prosecution. I put successful in inverted commas because any penalty was a slap on the wrist and the retail public are lucky they got even that right. Best example I can give is Nuix. Stephen Doyle was CFO and his brother Ross was a contractor at Nuix. Two weeks before disastrous HY results were released to market, Ross sold $17.8m worth of shares, nothing sus! They were caught red handed insider trading, but ASIC bungled the prosecution so badly that they had to drop the case… meaning that the white collar crims not only didn’t end up in gaol, they got to keep their ill gotten gains, but the cherry on top was the ride off into the sunset with damages - for ASIC dragging their good name through the mud. See attached newspaper article!
But institutional investors can be trusted can’t they? Nothing like the Banking Royal Commission where banks were levying fees on dead people could happen could it?
85% (ballpark) of trades on the ASX are placed algorithmically. Who is reviewing the code? Legislation points to the ASX who have said they ask managers to review their own code because it is a requirement of their AFSLs… what a great idea. Has anyone noticed the charade that is the trading from 3:55pm onwards? It’s like children queuing up to spend their pocket money. 1 share here, 2 shares there…
According to ASIC, “we view algorithmic trading in aggregate over the day and not in isolation”. My response of course was, “which retail investors are afforded the same treatment”? Doesn’t sound like a “fair, orderly and transparent market” to me per s792 of the Corps Act. I guess that’s why there are class actions afoot against the ASX and ASIC. With preliminary discovery (defendant(s) can view the class action and elect to pay the plaintiff their stipulated figure in return for an NDA) then the gravy train rolls on. Acceptance (without admission of guilt) via preliminary discovery means that nothing appears in the AFR or Law Reports and the gravy train rolls on. If you think this couldn’t possibly be right and a couple of claims of $250m would knock this “preliminary discovery” on the head, think again. When the gold traders in the US at JP Morgan were caught manipulating the gold price and a number went to jail, JP Morgan were fined USD $920m. That was three days’ profit for the JP Morgan gold desk! I think you get my point.
https://www.justice.gov/opa/pr/former-jp-morgan-precious-metals-traders-sentenced-prisonhttps://www.copyright link/technology/brother-of-nuix-cfo-had-swipe-card-for-office-before-share-sales-20230823-p5dytz
(20min delay)