‘No evidence’ of insider trading ahead of Steinhoff’s collapse

SA’s Financial Sector Conduct Authority (FSCA) says it has found no evidence of insider trading in Steinhoff shares before the retailer’s meltdown on the JSE — though it still has a few trading accounts to check.

Bloomberg reported previously that Steinhoff’s former CEO, Markus Jooste, had advised friends to sell the company’s shares days before the stock collapsed.

The message, sent in late November 2017 to at least two people, told recipients there was impending, unspecified bad news coming.

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Then, on December 5 2017, the company said it had uncovered accounting irregularities and that Jooste had quit, causing the shares to plunge 63% in a single session.

The FSCA said on Thursday that in the week before the share collapse, about 30.7-million shares were traded with a total market value of more than R1.7bn.

But the authority said it had “closed its files” on three accounts where more than R419m worth of shares were traded. It has investigated 56 accounts for insider trading so far “with no adverse findings”.

“We found no reason to believe that any of these shares were traded in contravention of the Financial Markets Act.” said Brandon Topham, divisional executive for investigation and enforcement at the FSCA.

However, more accounts, under which R46m worth of shares were traded, “will continue to be investigated and a press update will be issued upon finalisation of the investigation”.

hedleyn@businesslive.co.za