FL Group to be fined? Skip to content

FL Group to be fined?

Icelandic investment company FL Group could be facing a fine after an announcement about an extensive business agreement related to insider trading in the company reached the OMX stock exchange in Iceland 54 days too late.

According to the 63rd article of laws on securities trade, the stock exchange should be notified of such business agreements on the same day they take place, Morgunbladid reports.

TBH Investments Ltd. sold 55.5 million shares in FL Group at a value of ISK 29.09 (USD 0.49, EUR 0.35) per share on June 1, but the stock exchange was not notified of the business agreement until July 23.

Paul Davidson, who is on the board of directors in FL Group, is also on the board of directors in TBH, and thus TBH is considered related to an insider in FL Group.

According to Kristján Kristjánsson, the director of FL Group’s corporate communications, the delay was caused by a misunderstanding between Icelandic and foreign lawyers about regulations on the obligation of announcements in Iceland.

In cases like these, the stock exchange notifies the Financial Supervisory Authority (FME) about the violation, which decides whether the company in question is to be fined.

FME ruled that Actavis Group should pay a fine worth ISK 500,000 (USD 8,400, EUR 6,100) last year in a similar case, when the delay had only been four days.

It is not clear when FME will announce its decision, but when it does FL Group will comply with it, Kristjánsson said.

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