Trades get all-clear from 'world leader'

A witness described as one of the world’s leading experts in market manipulation is reportedly due to tell the Auckland High Court there was no evidence Mark Warminger’s trading amounted to market manipulation.

Wednesday, September 28th 2016, 5:59AM 1 Comment

The Milford Asset Management portfolio manager is in court, fighting Financial Markets Authority accusations that he misused his position with an institutional investor by placing trades in stocks in one direction to move the price so he could later shift significant off-market sales at a greater profit. This is known as cross-trading.

He is also accused of making trades to set artificial prices.

But Warminger’s lawyer, Marc Corlett, reportedly told the court on Tuesday that Professor Michael Aitken, of Sydney’s Macquarie University, had considered the trades in question and not found any instances where it breached the law by creating a false or misleading appearance.

"One might well ask why we are here given the evidence of Professor Aitken," he said.

By contrast, he said the FMA expert witnesses were “enthusiastic amateurs”.

It has been argued that Warminger was under performance pressure at the time of the trades because the fund he managed was not keeping up with the benchmark.

But Corlett argued that all the trades in question would have increased the fund value by $50,000 on a total $669 million.

Warminger’s case is the first relating to market manipulation to go to trial in New Zealand. He is on extended leave from Milford Asset Management, which reached a settlement with the Financial Markets Authority. Key players at Milford were set to be called as witnesses by the Financial Markets Authority but now only executive Brian Gaynor will appear, and only for the defence.

Tags: FMA Milford Asset Management