JB Were charged $50,000 over Rubicon purchase for GPG

By NZPA

Thursday 25th July 2002

Brokerage JB Were has to pay $50,000 towards redrafting stock exchange rules following its purchase of Rubicon shares on behalf of investment firm Guinness Peat Group.

Another brokerage complained to the New Zealand Stock Exchange (NZSE) about JB Were's purchase on July 4 of 50.33 million shares in forestry and biotechnology company Rubicon on behalf of GPG.

The brokerage complained the trade had broken rules requiring brokers to buy a certain portion of any bid for more than 10 percent of a stock from other member firms.

NZSE chief executive Mark Weldon said the exchange now had previously undisclosed information about why JB Were was satisfied it was acting in accordance with Rule 8, which requires "good stockbroking practice".

"The NZSE is now aware of the procedural steps JB Were took to confirm it was acting appropriately, and acknowledge that they were acting in good faith in carrying out their client's instructions," Mr Weldon said in a statement.

The exchange had to resolve the issues raised by the complaint, and was confident the outcome would provide increased market certainty.

The NZSE would redraft its rules regarding stands in the market and release a policy statement on the procedures to be followed, he said.

JB Were said it believed the outcome was a "constructive and responsible way" to end the matter.

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