ASIC has banned former Gleneagle fund manager, Gregory Tolpigin,...

ASIC has banned former Gleneagle fund manager, Gregory Tolpigin, from providing financial services for naked short selling.

Tolpigin is also banned from controlling a financial services business or performing any function involved in carrying on a financial services business as an officer. ASIC found Tolpigin engaged in the naked short selling of shares on 150 occasions totalling over $7 million from 19 January to 27 August 2021.

Tolpigin sold shares on the ASX through accounts held with Gleneagle and associated entities. But he didn't own or borrow the shares at the time he placed the orders to sell them.

The unauthorised naked short selling practices by Tolpigin distorted the accuracy of the ASX's daily gross short sales report, ASIC said.

ASIC said it views the prohibition of naked short selling as an "essential policy" for the maintenance of financial market integrity.

"It [prohibition] reduces the risk of settlement failure, distortions to the operation of financial markets and abuse short selling that can artificially depress prices. It also improves the accuracy of information available to the market," ASIC said.

"ASIC will continue to identify non-compliance and take enforcement action where necessary."

Nevertheless, ASIC added that it recognised that covered short selling, when carried out within legislative and regulative parameters, is a legitimate mechanism for price discovery and liquidity.

The regulator doesn't seek to "limit" or "restrict" short selling that is compliant, it confirmed.

Seems ASIC do occasionally look at short selling, wonder if its all legit on AGY?