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Japan finance watchdog calls for US brokerage fine
Japan's securities industry watchdog has called for the financial services agency to slap a fine on US brokerage house First New York Securities for alleged insider trading.
Japan's securities industry watchdog has called for the financial services agency to slap a fine on US brokerage house First New York Securities for alleged insider trading.
This is the first time the Securities and Exchange Surveillance Commission (SESC) has recommended an overseas financial institution be fined over alleged insider trading tied to stock offerings.
It is the third time since March that the SESC has called for a fine in a case of insider trading linked to stock offerings managed by Japan's biggest brokerage Nomura Securities, whose internal controls are the focus of an ongoing investigation.
Late Friday the SESC called for the financial authority to impose a penalty of 14.68 million yen (US$ 184,000) on New York Securities for trading Tokyo Electric Power shares based on inside information regarding a 2010 share offering.
The SESC also asked that a private consultant who conveyed information obtained from the principal underwriter Nomura, also be sanctioned.
Concerns about Japan's flagging reputation for corporate governance has sparked renewed pressure for a crackdown on lax regulations.
Last week the SESC recommended that Asuka Asset Management be fined for short-selling Nippon Sheet Glass shares after illegally obtaining information ahead of a stock sale that JPMorgan was underwriting.
A sales executive for the US bank -- which is already reeling from a shock $2.0 billion loss on derivatives trading -- was the source of the leak, Dow Jones Newswires reported earlier, citing an unidentified source.
Criminal convictions for trading on inside information are few and far between in Japan, with those caught often only receiving token punishments.
