its worth posting the whole article, which provides balancing information. Here goes.
A DIRECTOR who was an architect of insider-trading legislation in 1985 has regularly bought his company's shares shortly before market-sensitive announcements.
As a director of the junior iron ore and gold explorer Pluton Resources, Ray Schoer made six share purchases in the seven days before company results or a big company announcement. He also made up to 18 purchases outside the company's published share trading policy for directors.
Mr Schoer is well known as the chief executive of the National Companies and Securities Commission between 1980 and 1990 and in the next five years as national director of the Australian Stock Exchange.
He said yesterday his purchases were made to support a company with thinly traded shares that was yet to make a profit.
Mr Schoer said he contacted Pluton, which was listed in December 2006, to avoid buying shares when the company held market-sensitive information.
His purchases since early last year were under a revised directors' trading policy that was only approved by the board last October and is yet to be announced.
"My trading was consistent with the policy that was being implemented," Mr Schoer said yesterday. "I contact the company in advance and say I'm proposing to buy shares."
Melbourne-based Pluton Resources is managed by Mr Schoer's son, Tony, and includes as board members the former NSW premier Neville Wran, as chairman, and the high-profile company director Albert Wong.
Concerns about directors' trading in their own shares were raised last month by 10 big institutional investors, including Vanguard and BT Investment Management.
"If investors cannot be confident that equitable conditions exist for all security holders, they may avoid certain securities and ultimately threaten security value," the institutions warned.
The policy followed by Mr Schoer allowed him to buy 18,500 shares in the four days before a trading halt to announce the company had gained environmental approval for drilling on Irvine Island, Western Australia.
And it allowed him to buy 23,000 shares in the seven days before an announcement about promising test results confirming the potential of drilling at its Tasmanian tenements.
Over the period of Mr Schoer's buying, shares in Pluton Resources have risen more than sevenfold from their 20c issue price to their close yesterday at $1.53.
Mr Schoer is unfazed by perceptions of his frequent purchases, saying: "[If] a director wished to indicate support to the company in circumstances in which people were selling, I think that's a perfectly respectable thing for the director to do, provided the director is not insider trading."
The company secretary, Andrew Metcalfe, said he had been contacted by Mr Schoer about his purchases.
"The board was all fully aware of the trading that Ray was doing," Mr Metcalfe said.
The original directors' share trading policy, which is designed to avoid any perceptions that directors are using inside information, called for every trade by a director to be approved by the company's chairman.
The original policy, which was published in the annual report in October, also restricted directors' trading in Pluton's shares to a four-week period after the interim and full-year reports and the annual general meeting.
Mr Wran and his predecessor as chairman, Mr Wong, said they had not been contacted to approve Mr Schoer's trading. Both said they were unaware of the extent of Mr Schoer's trading.
Mr Schoer said that, shortly after listing, the original trading policy was dropped in favour of one that allowed directors without "inside" knowledge to trade in their shares at any time, excluding a 24-hour period after a market-sensitive announcement.
Research released last month by the corporate governance adviser Regnan found that in 23 of the top 200 companies, directors had traded company shares within a "blackout period" between the closing of the company accounts and company results.
"Clearly the lapse of vigilance by regulators has not helped discourage inappropriate trading practices," Regnan's managing director, Erik Mather, said yesterday. "We don't need more regulation but rather enforcement of the existing sound rules."
Mr Schoer has been widely quoted in recent weeks as condemning the shortcomings of market regulators in addressing the short-selling that has dogged the market.
He told The Australian this month that the regulator needed to do more to prevent market manipulation by "cowboys who believe they can drive a market down for their own benefit".
Mr Schoer's board appointments have included the chairman of IOOF Holdings and chairman of Sydney Gas.
PLV Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
