South African regulators are investigating possible insider trading at Discovery after shares fell sharply the day before a downbeat trading update in February, the insurer said on Wednesday.
Discovery shares fell 5.5 percent on Feb. 16, a day before South Africa’s biggest health insurer said it expected a fall of as much as 55 percent in first-half profit.
Discovery immediately reported the unexpected share price move to the Johannesburg Stock Exchange (JSE) who in turn notified the Financial Services Board (FSB), chief financial officer Richard Farber said.
“We are co-operating fully with the FSB in their inquiry,” he told Reuters.
The head of FSB’s directorate of market abuse, Solly Keetse, said the regulator would disclose the details of the investigation when the report was complete.
Credit: CNBC Africa