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Keurig Green Mountain, Inc. Message Board

  • Saltman512 Saltman512 Jan 25, 2012 3:48 PM Flag

    Einhorn's letter re Fine

    Here is the response--he of course quotes the only favorable language in the decision, ignores that they said his claims were unreasonable:

    http://blogs.wsj.com/deals/2012/01/25/heres-einhorns-statement-on-fsa-fine/

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    • Einhorn pulls one sentence out, but look at all the actual language hammering him for his conduct following his private cc with management:

      On 9 June 2009, Einhorn was a party to a telephone conference in which it was disclosed to him by a corporate broker acting on behalf of Punch Taverns Plc that Punch was at an advanced stage of the process towards a significant equity fundraising. This was inside information and Einhorn should have appreciated this.

      A matter of minutes after the telephone conversation had concluded and on the basis of that inside information Einhorn gave instructions to sell all of Greenlight’s holding in Punch. At the time these instructions were given Greenlight held 13.3% of Punch’s issued equity.

      . . .

      The FSA accepted that Einhorn’s trading was not deliberate because he did not believe that it was inside information. However, this was not a reasonable belief. Investment professionals are expected to handle inside information carefully regardless of whether they have been formally wall-crossed. This was a serious case of market abuse by Einhorn and fell below the standards the FSA expects, particularly due to Einhorn’s prominent position as President of Greenlight and given his experience in the market.

      Tracey McDermott, acting director of enforcement and financial crime, said:

      “Einhorn is an experienced professional with a high profile in the industry. We expect someone in his position to be able to identify inside information when he receives it and to act appropriately. His failure to do so is a serious breach of the expected standards of market conduct.

      “It is highly damaging to market confidence when privileged shareholders commit market abuse, and the high penalty reflects the seriousness of his breach.”

    • And of course he puts the fine amount in pounds at 7.2m, fails to mention that is 11.2 million US dollars in fines.

      • 1 Reply to Saltman512
      • We should call in and participate (sure we would be screened out):

        Greenlight will be hosting a conference call to discuss this matter at 4:00 p.m. Eastern Time today, January 25, 2012. The conference may be accessed by dialing 1-877-686-1650 (U.S. callers) or 1-857-244-8201 (International callers) and entering the passcode 76371374#. Those who intend to participate in the call should dial in at least 10 minutes in advance. A replay of the call will be available through February 2, 2012 by dialing 1-888-286-8010 (U.S. callers) or 1-617-801-6888 (International callers) and entering the passcode 21316928#.

 
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