Brazil - Suspected Petrobras insider trading as already on B3's radar

Insider trading From Simple English Wikipedia, the free encyclopedia Jump to navigationJump to search Insider trading means the trading of public companies' stocks and other assets on stock markets using secret information. This is done by getting people who have confidential or non-public facts about how much a stock is really worth to tell traders so they can buy or sell.[1] A stock could be worth more or less than the public knows, depending on how well a company is doing in making money. In many countries, insider trading with secret information is against the law and thought to be a bad thing to do. Some economists think insider trading should be allowed.[2]

Suspected Petrobras insider was already on B3's radar The newspaper O Globo revealed that transactions with company papers that have all the appearance of using insider trading gave an investor a profit of around R $ 18 million Suspected Petrobras insider was already on B3's radar © Getty Minuto Brasil News RIGHT NOW BY ESTADAO CONTEUDO

ECONOMIA PETROBRÁS Share THEatypical operations with Petrobras shares had already attracted attention within B3, the São Paulo stock exchange, in the days that followed the signal given by President Jair Bolsonaro that he intended to change the command of the state company. BSM Supervisão de Mercados, a self-regulating arm of the capital market linked to B3, identified that some operations did not fit the regular pattern, and was already investigating, Estadão found out . The newspaper O Globo revealed that transactions with company papers that have all the appearance of using insider trading gave an investor a profit of around R $ 18 million.

An atypical transaction is easily captured by the B3 system, which always supplies the Securities and Exchange Commission (CVM), the sheriff of the capital market, with such information. The structure is able to perceive, for example, when a stock moves very quickly for no apparent reason and when an unusual financial volume is observed in a given asset. In general, however, insider trading operations are carried out in small volumes, so as not to attract the regulator's attention. 

The case of Petrobras disagrees with this pattern. In the market, the assessment is that the characteristics of the operation give all the signs that it is an insider trading. In other words: an operation carried out by someone who had information that Bolsonaro would make statements in his live broadcast on social networks about Petrobras on Thursday, February 18, and that the resignation would take place the following day. One point draws the attention of those who follow the subject closely. The option chosen for the Petrobras stock (the oil company traded on the stock exchange has several options) in question was one that in the jargon of the market is called "out of money". This means that, at the time of the purchase of the paper, its exercise (the value that the contract established for the sale) would not compensate if it were at the time of its maturity. Choosing an option that would draw so much attention to becoming an insider would not be the best alternative to go unnoticed. 

He is very amateur, according to market sources. In this specific case, such an investor bought on the 18th, a Thursday, the option to sell for R $ 26.50 the Petrobras share on its maturity, a few days later, on the 22nd, but the share was worth at that time R $ 29.27. In other words: whoever bought it had the conviction or great belief that the paper would fall by at least 9%, or that transaction would cause him financial losses. The shares, the following day, fell more than 6% and with the public news of the change of command of Petrobras, they fell about 20% in just one day. In the ongoing investigation, regulators - both BSM and CVM, which maintain a parallel investigation -

 focus on the investor itself and his profile, trading history and his asset portfolio. If the investor behind this operation with Petrobras papers, for example, is a newcomer to the Stock Exchange, the indication of irregularity is great, since options are slightly more daring operations. This investigation will also analyze how the assets behave with the proximity of certain events, even a live of the president. Tullet Prebon, the brokerage that originated the operations, is regulated by the CVM, which may request additional information. As a rule, if the self-regulator reaches a conclusion that it considers suspicious, it may call the Financial Activities Control Council (Coaf). The CVM, in turn, can refer the case to the Public Ministry and the Federal Police. 

The use of privileged information is a crime punishable by law. In the case of the operation with Petrobras, the indication of crime is high, in the opinion of experts, because this investor bought the option practically one day before the maturity, making the operation extremely risky - unless there was a certainty that the stock would soon experience one of the strongest falls in its history. However, the difficulty of proving yourself as an insider is great. This is because it is difficult to pinpoint that a certain person, in fact, had inside information and that he used it to make money. At Petrobras, the climate of tension was known, given the increase in fuels and increasing pressure from truck drivers. Therefore, an investor could make this bet.

 However, the format of this one in question has attracted a lot of attention. Sought, the CVM said that it monitors and analyzes the movements of publicly-held companies, "taking the appropriate measures, whenever necessary. The Municipality does not comment on specific cases". B3 did not comment. The information is from the newspaper O Estado de S. Paulo. 

 https://www.noticiasaominuto.com.br/economia/1782614/suspeita-de-insider-da-petrobras-ja-estava-no-radar-da-b3