A second settlement has been reached for alleged irregular transactions in Cadbury Schweppes shares, the Financial Services Board’s (FSB) insider trading directorate said on Wednesday.
”The directorate now reports that, as is provided for in the Insider Trading Act, a settlement has been reached with Mr Laurence Benjamin Gottlieb who has agreed to pay an amount of R619 170 to the directorate,” chairperson Rob Barrow said.
The settlement, relating to share transactions in October 2002, was made an order of the court on Tuesday.
The investigation into insider trading of Cadbury Schweppes shares was referred for legal action in February 2002, Barrow said in a statement.
Following this, the directorate reached a settlement of R607 170 with David Vermeulen in December 2002.
Neither Vermeulen nor Gottlieb were employees of Cadbury Schweppes.
Vermeulen worked for a merchant bank involved in helping Cadbury Schweppes with a R1,5-million buyout in 2000. He was alleged to have traded on the inside information to which he had access.
Although the two men have agreed to pay settlements, this does not exclude criminal liability. The FSB has referred the entire case to the National Director of Public Prosecutions for them to consider criminal prosecution.
It is also continuing with civil action against other parties.
Under the Insider Trading Act the FSB can issue a civil summons against alleged offenders for up to four times the profit gained, or the losses avoided through unlawful insider trading. – Sapa