Consob sanctions two Dutch investment funds, Optiver and Flow Traders, which in the summer of 2022 operated massively with naked short sales (i.e. without borrowing the securities to be sold, a practice prohibited by European and national legislation) on Saipem shares in occasion of the company’s hyper-dilutive capital increase.
On 12-14 July, while the capital increase was underway, Optiver moved, as stated in the resolution, 44.33% of Saipem’s capital. It did not inform either Consob or the market, thus violating the transparency regulations prescribed by the European regulation on short selling. And he realized a capital gain of 2.7 million euros. The fund is now sanctioned by Consob for 2.5 million euros plus the confiscation of all illicit profits (2.7 million).
Similar situation for Flow Traders. In July 2022 it moved 7.2% of Saipem’s capital; did not make the necessary communications and made a capital gain of 2.2 million euros. He is fined 2.2 million plus another 2.2 euros in confiscation of the illicit profit.
Overall, between sanctions and confiscations, they amount to 9.6 million euros.
The two sanctions were published this morning on the Consob website.
Both funds were market makers, so they should have ensured liquidity to the market. Both disregarded the warning made by Consob in June 2022 precisely in view of Saipem’s capital increase.
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