On Wednesday, March 23, David Baazov, CEO of online gambling company Amaya, was charged with insider trading by Quebec security regulators (AMF). This news broke the same week Amaya launched its online poker client, PokerStars, in the state of New Jersey – the first time the site has operated within the United States since 2011.
The charges as listed in an Amaya corporate release are as follows:
“The AMF has charged Amaya’s Chairman and Chief Executive Officer, David Baazov, for aiding with trades while in possession of privileged information, influencing or attempting to influence the market price of Amaya securities and communicating privileged information but has made no allegation of wrongdoing by Amaya or any of its subsidiaries or other directors or officers.”
How has Amaya responded?
Currently, Amaya and Baazov deny any wrongdoing and the company is defending Baazov’s innocence. The company has stated that it is fully cooperating with the AMF.
Dave Gadhia, lead director and an independent board member at Amaya, spoke about his company’s position and the actions it will take going forward in the Wednesday release:
“David Baazov has the full support of the independent members of the board. As noted previously, Amaya conducted an extensive internal review, supervised by its independent board members with the assistance of external legal counsel from Osler, Hoskin & Harcourt LLP in Canada and Greenberg Traurig LLP in the U.S., which thoroughly reviewed the relevant internal activities surrounding the Oldford Group acquisition.
This review found no evidence of any violations of Canadian securities laws or regulations. The independent members of the board received and reviewed the information and concluded that no action should be taken. We have not been provided with any new information upon which the AMF’s allegations of infractions are based.”
Details of the charges
Baazov isn’t the only person to be involved in Wednesday’s scandal – two others and two consulting companies were also accused of similar crimes. The two individuals who have been charged are Benjamin Ahdoot and Yoel Altman. Both men are facing charges of trading while in the possession of privileged information and influencing the market price of securities at Amaya Inc.
Both consulting firms are facing similar charges as the two individuals. The AMF alleges that all of the accused participated in insider trading between December 2014 and June 2014.
Louis Morisset, President and CEO of the AMF, made an official statement on Wednesday speaking about the charges:
“We have made suppressing illegal insider trading and market manipulation a top priority, as this type of conduct profoundly affects public confidence and the integrity of our markets.”