Former fund manager banned for $7m naked short selling
A former fund manager has been banned by the Australian Securities and Investments Commission (ASIC) for three years for naked short selling of shares worth $7 million.
Gregory Tolpigin was a former fund manager and authorised representative at Gleneagle Securities.
ASIC said naked short selling occurred when a person sold certain financial products, such as shares that were not held and could not be transferred to a buyer at the time the person placed the sell orders.
Tolpigin engaged in the practice on 150 occasions totalling over $7 million from 19 January to 27 August 2021, by selling ASX shares through accounts held with Gleneagle Securities and associated entities. He did not own or borrow the shares at the time he placed the orders to sell them.
This meant the sales risked settlement failure in the event that he was unable to buy the shares back prior to settlement, for example, if they had been suspended from trading.
It also distorted the accuracy of the daily ASX gross short sales report, which contributed to Australia’s financial markets.
Tolpigin was banned from providing financial services, controlling a financial services business, or performing any function that involved carrying on a financial services business as an officer.
The regulator said it was “reviewing compliance by market participants with the short selling regime” and viewed it as an essential policy for the maintenance of market integrity.
It also recognised that covered short selling, when carried out within the legislative and regulatory parameters, was a legitimate mechanism for price discovery and liquidity and did not seek to limit or restrict short selling that was compliant with the legal and regulatory regime.
AUTHOR
Laura Dew
Recommended for you
Several wealth management companies have been shortlisted in the second annual Australian AI Awards program, which champions individuals and organisations pioneering Australian AI innovation.
Women are expected to inherit US$124 trillion through the intergenerational wealth transfer, but Capital Group has found they are twice as likely to rely on social media for advice over a financial adviser.
Challenger Investment Management has raised $350 million during the offer period for its new ASX-listed investment structure.
A week after Lonsec downgraded multiple funds from Metrics Credit Partners, rival research house Zenith Investment Partners has opted to retain its ratings for the same funds.
