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Former Gunns boss and convicted insider trader John Gay to pay $500,000 | The Mercury

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Finally some common sense… This should have been done in the beginning. 😐

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Politics Random Ramblings

The Expected Result (No Surprises)

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FORMER Gunns Ltd boss John Gay has avoided a jail term and been fined $50,000 for insider trading.

Justice David Porter handed down the penalty today in the Supreme Court in Launceston, with Gay later describing the past four years as "among the hardest" of his life.

Gay, 70, of Clarence St, Launceston, pleaded guilty earlier this month to one count of insider trading.

He sold 3.4 million Gunns shares from December 2 to 10, 2009, while possessing information from an October management report that he ought to have known would affect the stock price.

Gunns shares dropped from the average price he achieved of 90 cents to 68.5 cents in February 2010.

Justice David Porter said Gay's offence was less serious than many cases of inside trading.

This was because Gay had made a decision to sell before he received the price-sensitive information and the decision to sell was health related.

The judge said Gay also spoke to the company secretary Wayne Chapman before the sale and was told there was a window of opportunity under the company's trading policy.

Justice Porter said Gay ought have known, rather than did know, the information was price sensitive.

In passing sentence, he told the court Gay was of good character and the former CEO's ill health was relevant.

As a result of his conviction, Gay is disqualified from managing corporations.

He did not comment after leaving the court but later issued a statement saying he was looking forward to spending more time with his family and focusing on his health now court proceedings had ended.

He said the past four years had been among the hardest of his life.

"I'm looking forward to enjoying time with my wife, children and grandchildren, working on my farm and focusing on my health," Mr Gay said in a statement.

"My family and I would like to sincerely thank so many people who have offered their support and friendship during this time.

"I hope all people respect my privacy as I work though treatment for my ongoing battle with cancer."

Sourced from The Mercury

The direct actions of John Gay have essentially cost a lot of people their livelihood as the timber company Gunns collapsed as a direct result of his actions. The law in this case has failed the former workers and contractors by allowing John to walk free with nothing more than a slap on the wrist, considering the outright personal profit made by selling his shares. It would be good to see a class action taken against John Gay by the former workers of Gunns for loss of lifestyle (or similar) but I can't see this happening. 

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Why am I not surprised?

 

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THE Crown has told a Supreme Court Judge today it is not pushing for a full-time jail sentence for former Gunns chairman John Gay.

John Eugene Gay, 70, of Clarence St, Launceston, pleaded guilty on August 5 to one count of insider trading.

Gay sold more than 3.4 million Gunns shares between December 2 and December 10, 2009, while in possession of inside knowledge from the company's October management report.

Justice David Porter heard sentencing submissions from prosecution and defence this morning.

Commonwealth prosecutor David Staehli, SC, said the unusual circumstances of the case meant the Crown accepted that a sentence not involving full-time custody may be justified.

Defence counsel Neil Clelland, SC, also submitted that punishment did not require a sentence of imprisonment.

He outlined Gay's history of prostate cancer and his "uncertain" prognosis to Justice Porter.

He said that after his cancer diagnosis Gay had resolved to sell shares to address his $14 million debt to the ANZ Bank.

The decision to sell was made before he saw the October management report which detailed the company's plummeting fortunes.

Mr Clelland said the defence was aware that Gunns divided public opinion.

He said the Gay family's pet dog had been poisoned and the family was threatened and vilified, especially during the pulp mill debate.

The court heard last week that Gay sold shares at 90 cents each, yielding $3.09 million, before they fell by 19 cents a share after the half-year result was released in February 2010.

The hearing continues this afternoon.

Sourced from The Mercury

I'm speechless…

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