Former Gunns chair guilty of $3m insider trading but only gets a $50k fine
By Juliette Overland
The former chairman of Gunns Ltd John Gay has received a $50,000 fine for insider trading but will not serve time in jail. Will such a sentence really deter others who might be tempted to engage in insider trading?
Earlier this month, Mr Gay entered a guilty plea to charges of insider trading resulting from the sale of 3.4 million Gunns’ shares for about $3 million in late 2009. At the time he sold the shares Mr Gay was aware of a private management report which indicated an expected drop in Gunns’ profits. When the report was later released, Gunns’ share price dropped significantly. This means that Mr Gay avoided a significant loss by selling the shares when he did.
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