The JSE has confirmed that it cancelled suspicious trades in the shares of Gupta family-controlled Oakbay Resources and Energy last Friday, but added it was not accusing the company itself of wrongdoing.
On Monday, Business Report reported that a 28% jump in Oakbay’s share price had been flagged as suspicious by the JSE.
The JSE’s senior technical advisor in market regulation, Peter Redman, said: "There is nothing to suggest that the company is in any way connected to the trades in question."
Redman said the JSE’s approach to surveillance of trade activity is proactive. "We monitor all trade taking place on the market as it happens, and respond when we pick up unusual activity. When routinely monitoring trades during the morning of Friday March 31, the JSE’s market regulation team identified trades in Oakbay Resources and Energy shares that appeared to be evidence of market abuse. These trades were cancelled."
A report has been prepared and will be handed to the Financial Service Board’s directorate of market abuse, he said.
Oakbay’s shares have a history of large price jumps on low volumes — most notably on May 15 2015 when it jumped to R50 from R11.15 with just 10 shares trading. What made that trade extremely suspicious was that it occurred around the time the Guptas’ mining company was settling a R250m loan from state-owned financier Industrial Development Corporation (IDC) by paying back shares.
Considering Oakbay’s share price has since fallen back to R9.15, if the IDC accepted the R50 share price, taxpayers effectively gave the Guptas about R200m in the deal, not to mention the interest that should have been paid.
And that does not even include the sweatheart deal Oakbay’s associate Tegeta got from Eskom in its purchase of Optimum colliery.
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