Former Aston Hill execs entangled in Amaya case

Former senior executives at Aston Hill Financial Inc. are among those swept up in an insider tipping and trading probe involving online gambling firm Amaya Inc.

In a statement of allegations released Wednesday, staff of the Ontario Securities Commission allege Aston Hill’s former co-chief investment officer Ben Cheng became aware of undisclosed material facts about Montreal-based Amaya in April 2014, and later informed John David Rothstein, then Aston Hill’s national sales manager.

Rothstein is trying to settle the allegations. A hearing to consider the settlement is set for April 18.

A third man, Frank Soave, who was then an investment adviser at CIBC Wood Gundy, is also accused of insider trading. None of the allegations have been proven.

The statement of allegations also accuses Cheng, Soave and Eric Tremblay, who was then chief executive of Aston Hill, of making “misleading statements” on material matters or omitting facts when examined under oath by OSC staff. The regulator alleges that Cheng learned about Amaya’s plans to buy the parent company of the owner and operator of the Poker-Stars and Full Tilt Poker brands in a transaction valued at $4 billion in April 2014 when Aston Hill was invited to participate in financing the deal. At a subsequent meeting in June — before the deal was announced along with Amaya’s plan to issue new shares at $20, a 66 per cent premium — OSC staff allege Cheng shared some or all of the information with Rothstein and “instructed, encouraged, and/or suggested to Rothstein to inform others, who had lost money on certain other investments promoted by AHF (Aston Hill).”

Rothstein reached Soave by telephone on June 12, 2014 and told him that Amaya “was about to announce a major transaction that would be significantly positive for its share price,” and that he had learned this information from Cheng because Aston Hill was participating in the acquisition, according to the OSC.