FSB drops Pinnacle probe - TechCentral

FSB drops Pinnacle probe

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There was more good news for JSE-listed Pinnacle Holdings on Tuesday after the Financial Services Board (FSB) announced it was dropping an insider trading investigation into share trades by company executives in March 2014.

At a meeting on Tuesday, the FSB decided to close the investigation, Pinnacle said in a statement to shareholders shortly before the market close. “No enforcement action will be taken.”

The news comes just three weeks after charges of attempted bribery instituted against Pinnacle director Takalani Tshivhase were dropped by the specialised commercial crimes unit of the national directorate of public prosecutions. Tshivhase was accused of trying to bribe a top police official with R5m to secure a lucrative IT contract.

News of the arrest sent Pinnacle’s share price plummeting. It soared on the news that the charges against Tshivhase had been dropped.

The FSB had been looking into possible insider trading prior to news of Tshivhase’s arrest, which was broken by TechCentral.

The FSB did not say who the subject of its probe was. However, company directors had been actively selling shares in the company in the weeks before the news of Tshivhase’s arrest broke.

Tshivhase himself offloaded R4m worth of shares, while CEO Arnold Fourie, through his family trust, sold 1,2m shares. The company said Fourie had no option in selling the shares as it was a forced sale, while Tshivhase had asked for permission to sell shares on 27 January, when the company was in a closed period, preventing him from trading at the time.

Permission was finally granted on 10 March, after he had been arrested (on 5 March). He needed the cash, the company said, to “fund a specific transaction of a personal nature”.  — © 2014 NewsCentral Media

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