Suspicious Oakbay trade cancelled but firm not accused of wrongdoing, says JSE

The JSE has confirmed that it cancelled suspicious trades in the shares of Gupta family controlled Oakbay Resources and Energy last Friday, but said 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 by the JSE.

The JSE’s senior technical adviser 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 was 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 & Energy shares that appeared to be evidence of market abuse,” he said.

These trades were cancelled, Redman said. A report would 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 suspicious was that it occurred at about the time the Gupta’s mining company was settling a R250m loan from state-owned financier Industrial Development Corporation by paying in shares. The share price has since fallen back to R9.15.