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Businessman gets five-month suspended sentence for insider trading
Telephone records seen as sufficient evidence
Helsinki District Court found on Monday that telephone records were sufficient evidence to convict two businessmen of illegal insider trading.
One of the members of the board of the telecommunications company Soon (formerly the Tampere Telephone Company), and his friend, were convicted of misusing insider information. The decision was based largely on telephone records uncovered during the investigation.
The board member who was found to have given his friend a stock tip was fined more than EUR 3,100 for misusing insider information. The friend was given a five-month suspended prison sentence for aggravated misuse of insider information. He had profited about EUR 34,000 from buying and selling shares in the company within a very short time.
The court’s decision is seen as significant, because the telephone records revealed nothing about the content of the conversations - only which telephones were in contact with each other and at what time.
The court nevertheless found that knowledge of the telephone contact was sufficient in light of the explanations given by the people involved, the time-sequence of decision-making by the Soon board, and the investment behaviour of the friend.
The telephone conversation took place in March 2001, and soon after that, the friend bought Soon shares worth more than EUR 83,000.
On the following day, the telecommunications company Elisa announced a buy-out offer to Soon shareholders, pushing the company’s share price up by more than 50%. The businessman sold the shares he had bought the day before for EUR 130,000, yielding a net profit of EUR 34,000.