The Australian Securities and Investments Commission (ASIC) has banned director of Foster Stockbroking (FSB), Mark Joseph Hinsley, from providing financial services for three years.
An initial investigation by ASIC raised concerns about Hinsley and FSB’s conduct regarding the allocation of shares in the initial public offering (IPO) of a small cap tech company, Reffind, to which FSB was the sole lead manager, and the firm’s publication of a research report in relation to the company in 2015.
The ASIC investigation found Hinsley had engaged in misleading or deceptive conduct contrary to s1041H(1) of the Corporations Act by failing to disclose to Reffind that a proportion of their shares in the Reffind IPO had been allocated to nominee accounts controlled by Hinsley and his fellow directors.
The research report, authored by Hinsley, contained assumptions and statements that had no reasonable grounds, and as a result, was misleading contrary to the Act.
The investigation also found Hinsley was involved in FSB’s contravention of its general obligations as a financial services licensee to act fairly and to have adequate arrangements to manage conflicts of interest in authoring the research report.
‘Licensees, their officers and employees who are appointed to manage equity raising transactions must act appropriately, comply with the law and ensure that the services provided are done so in an efficient, honest and fair manner,’ said ASIC Commissioner, Cathie Armour.