29101971 Post #: 3411468 Price at time of posting: $17.29* In Reply to msg: #3411268 IP: 165.228.xxx.xxx Sentiment: Sell Disclosure: No Stock Held Views: 188
What a farce today's close was. I saw one Opes stock trade at around 22.5c most of the day (between 21c and 24c) only to see it suddenly close at 27.5c in the post 4pm auction.
Note to ASIC, the ASX is a joke thanks to rogues like ANZ. ANZ - "banker and custodian" of the Opes Prime debacle.
Mark Hawthorne October 29, 2008 SEVEN months have passed since BusinessDay broke the story on Underbelly types with links to Opes Prime, but the failed stockbroking business and its margin loan book of penny-dreadful stocks is still giving regulators headaches.
The Australian Stock Exchange is examining purchases in listed companies in the final minute of trading on October 16 - the day creditors voted to liquidate Opes.
Claims from creditors, including those with margin loan accounts, crystallised that day. In other words, the closing price of companies on October 16 will be used by liquidator Ferrier Hodgson to calculate debts.
That opened the door for what is termed "window dressing" on the market - buying shares just before the close of trade to artificially inflate the final share price of a company.
"We regard it as a form of market manipulation, and warned stockbrokers to be wary of such trades resulting from Opes Prime being put into liquidation," ASX spokesman Matthew Gibbs said.
"If we suspect there has been window dressing of share prices at the end of trading that day, we will be referring the cases on to ASIC."
One transaction has already piqued the interest of regulators.
On October 16, listed Broad Investments traded at 0.1¢ a share all day. At 4.10pm, in the final seconds of trading, 1 million shares were bought on market at 0.2¢ a share - just $2000 worth - effectively doubling the potential claims of any Opes Prime creditor regarding Broad shares.
The shares were bought by Broad executive chairman Vaz Hovanessian.
The ASX had issued a circular to brokers the day before those trades.
"There are up to 1000 securities listed on ASX which may affect the interests of Opes Prime clients. Many of them are relatively illiquid and, as such, are susceptible to market manipulation," the ASX wrote.
"ASX requests market participants to be alert to any orders placed near the close on 16 October, 2008, which will increase the price of any of the securities on the attached list. A market participant which receives such orders should consider whether the client is seeking to fix a higher closing price for that day."
Broad was one of the securities on that ASX list, but Hovanessian strenuously denied any wrongdoing.
"I thought it was a good buy," he said. "It just happened on that day I bought some at point two."
Hovanessian said he was unaware that October 16 was the crystallisation date for Opes Prime debts. "It has absolutely nothing to do with that and is totally unrelated.
I wasn't even aware of that at the time and had no idea … it's pure coincidence."
He said the decision to buy the Broad shares was his own, but it is rather odd that Hovanessian denied knowledge of the significance of October 16 to Opes creditors, as he is a member of the committee of creditors, formed at the first meeting with the broker's administrators on April 8.
Sydney-based Hovanessian represents Fairstar Resources on that committee and flew to Melbourne to attend a meeting on October 15.
When Full Disclosure quizzed him a second time about his role on the Opes creditors committee, it elicited a somewhat more confused response: "But, um, um, I, um, er, um, I wasn't aware when I bought then that it could have made a difference, or it was, how shall I say, um, um, firstly it wasn't done for our purpose at all, um, at the time I bought it, I wasn't aware that that was the case."
Asked specifically if he was in Melbourne for a creditors committee meeting on October 15, Hovanessian said: "Yes.
I am on the creditors committee of Opes Prime, but there wasn't any huge discussion that people shouldn't buy, or that people should be aware of this, or anything like that, because it wasn't relevant to that particular meeting, although we knew at that meeting that (liquidation) would be the decision."
It's not the first time the tangled web of companies associated with Hovanessian has come across the radar of authorities.
Australian Federal Police are examining how inside information about a proposed takeover involving Fairstar and Golden West Resources may have been passed to Mick Gatto.
A co-director of Broad Investments with Hovanessian is Findlay Securities director Robin Armstrong. The AFP raided Armstrong's home in February in relation to the Fairstar probe.
Findlay, of which Armstrong remains a director, has also threatened to sue Fairstar Resources.
ANZ Price at posting:
$17.56 Sentiment: None Disclosure: Not Held
(20min delay)