Carnegie Investment Bank AB, Skandiabanken AB and UBS Limited, trading members at NASDAQ OMX Stockholm AB (“the Exchange”), have contravened the Exchange’s rules and regulations (“Exchange Rules”)by mediating sales orders subject to terms that deviated from the current market value. Accordingly, the Exchange’s Disciplinary Committee has ruled that the trading members are each to be fined four hundred thousand Swedish kronor (SEK 400,000).
The Exchange Rules stipulate that orders placed in the order book must reflect the current market value of the instrument in question and also constitute proper orders and trades. An order does not reflect the current market value if it has been registered at a price that could not constitute the current market value of the corresponding trade.
SeaNet Maritime Communications AB is the subject of trading on the First North exchange. On January 24, 2011, SeaNet implemented a one-for-1,000 merger of its shares (also known as a reverse split). The merger had been disclosed well in advance on SeaNet’s website and the information was also disseminated by means of various information systems. Nevertheless, Carnegie, Skandiabanken and UBS, during January 24, independently of each other, entered sales orders for the SeaNet share that, following adjustment, corresponded to a volume that exceeded the holdings of their respective customers.
Accordingly, these orders did not reflect the proper intentions underlying the trades and the conditions for completing delivery for the trades that occurred were lacking. The trading members’ actions gave rise to serious disruptions of trading in the share and the Exchange thus decided to cancel the trades and to suspend trading in the share.
On January 25, 2011, Eniro AB, whose shares are subject to trading on the Exchange, implemented a one-for-50 merger of its shares. The merger had been disclosed well in advance on Eniro’s website and the information was also disseminated by means of various information systems. Nevertheless, UBS entered sales orders for Eniro on January 25 at a price that obviously deviated from the market value.
Since the rules in question are of vital importance to the functioning of trading on the Exchange and for its credibility, the breaches cannot be regarded as minor or excusable. Accordingly, the trading members cannot avoid being sanctioned for their actions.
The Disciplinary Committee orders Carnegie, Skandiabanken and UBS to each pay a fine of four hundred thousand Swedish kronor (SEK 400,000).
The Disciplinary Committee’s ruling has been published on:
About the Disciplinary Committee
The role of NASDAQ OMX Stockholm’s Disciplinary Committee is to consider suspicions regarding whether Exchange Members or listed companies have breached the rules and regulations applying on the Exchange. If NASDAQ OMX Stockholm suspects that a member or a listed company has acted in breach of NASDAQ OMX Stockholm’s rules and regulations, the matter is reported to the Disciplinary Committee. NASDAQ OMX Stockholm investigates the suspicions and pursues the matter and the Disciplinary Committee issues a ruling regarding possible sanctions. The sanctions possible for listed companies are a warning, a fine or delisting. The fines that may be imposed range from one to 15 annual fees. The sanctions possible for Exchange Members are a warning, a fine or debarment. Fines paid are not included in the Exchange’s business but are attributed to a foundation supporting research in the securities market. The Disciplinary Committee's Chairman and Deputy Chairman must be lawyers with experience of serving as judges. At least two of the other members of the Committee must have in-depth insight into the workings of the securities market.
Members: Former Supreme Court Justice Johan Munck (Chairman), Supreme Court Justice Marianne Lundius (Deputy Chairman), Professor emirita Madeleine Leijonhufvud, Company Director Stefan Erneholm and Company Director Anders Oscarsson. Deputies: Former Authorized Public Accountant Bo Magnusson, Lawyer Wilhelm Lüning, Company Director Jack Junel, Ragnar Boman (MBA) and Carl Johan Högbom (MBA).
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