2014

Ming Chao Zhao Settles with the Ontario Securities Commission on Insider Trading Violations

TORONTO, May 17, 2013 /CNW/ - The Ontario Securities Commission today approved a settlement agreement reached between Staff of the Commission and Ming Chao Zhao, also known as Michael Zhao.

Zhao admitted that, between June 2010 and December 2011, he engaged in illegal insider trading, and has been ordered to pay an administrative penalty of $750,000, disgorge his profits of $416,719 and pay costs of $30,000.

Zhao was an Investment Banking Analyst at BMO Nesbitt Burns. As a result of his position at BMO, Zhao was in possession of undisclosed material information relating to five reporting issuers, specifically that they were involved in merger and acquisition transactions. He accessed the information about the transactions through a shared network drive.

Using an online discount brokerage account held by a family member under another name, Zhao directed the purchase of the securities of the five reporting issuers in advance of the public announcement of the merger and acquisition transactions. After the public announcement of the merger and acquisition transactions, Zhao directed the sale of the securities of the five reporting issuers to earn a profit of approximately $416,000.

Zhao's trading in the account was not disclosed to BMO contrary to its compliance policies.

Under the settlement agreement, subject to certain exceptions, Zhao is permanently prohibited from trading securities.  He is permanently prohibited from becoming or acting as a registrant or as a director or officer of a registrant. He is also prohibited from becoming or acting as a director or officer of an issuer for ten years.

"Our Insider Trading and Market Abuse Team is establishing momentum in detecting and pursuing cases of illegal insider trading," said Tom Atkinson, Director of Enforcement at the Ontario Securities Commission. "We are pleased with the results so far and will continue to focus on cases where individuals misuse confidential information for their own personal gain".

A copy of the Order approving the Settlement Agreement with Zhao is available at www.osc.gov.on.ca

SOURCE Ontario Securities Commission



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