FLI raps SEC for statements on insider trading

The majority owners of listed property firm Filinvest Land Inc. (FLI) yesterday scored the Securities and Exchange Commission (SEC) for the latter’s recent press statements pointing to three groups suspected of having engaged in insider trading of the stock since the later part of 2001.

Josephine Gotianun-Yap, president of FLI’s parent company Filinvest Development Corp. (FDC), categorically denied that FDC, its directors and the Gotianun family had engaged in insider trading, emphasizing that "overriding concern has always been for FLI’s timely payment of the convertible dollar bonds which redounds to the welfare of all stakeholders of FLI."

In a press briefing, the SEC’s Compliance and Enforcement Department director Tomas Syquia said they are digging deeper into the deals made by three groups on suspicions that they have engaged in the insider trading of FLI stocks.

Syquia, however, did not identify nor describe the three groups but only admitted the SEC was only pursuing more leads to build up the case. He said while there are no definite findings yet, the three groups were probed for the reported heavy dealings in FLI shares even before the announcement of the company’s P1.2-billion convertible bond issue in early February.

"FDC appeals to the SEC to refrain from issuing press releases that tend to cause damage to its reputation and the reputation of its directors principally based on mere ‘suspicions,’ " Gotianun-Yap said.

She added that since FLI has attracted investments by major foreign funds and regional investors, the SEC’s statements could "cast a cloud of suspicion on a perfectly legitimate transaction and will only serve to dampen foreign investors’ interest in the Philipine stock market."

Trading in FLI stocks heightened until early February when it was announced that the company would be issuing the convertible bonds to Reco Grandhomes Pte. Ltd., a property unit of the Government of Singapore, which would take up 23.4 percent of FLI’s outstanding capital stock upon conversion.

The Philippine Stock Exchange has initiated a probe on the case of possible insider trading but the results of its investigation were not publicly divulged but was instead forwarded to the SEC for further checks.

The SEC, however, has clarified their investigation is still in the initial stages and has no clear findings yet, with no particular party being pointed at.