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Globe says OSC case hinges on chain of liability

2014-08-21 07:53 ET - In the News

The Globe and Mail reports in its Thursday edition the Ontario Securities Commission has amended its statement of allegations against Paul Azeff, Korin Bobrow, Mitchell Finkelstein, Howard Jeffrey Miller and Man Kin Cheng. In a Globe special, Adrian Myers writes Mr. Finkelstein, a former partner at the law firm Davies Ward Phillips and Vineberg, is accused of supplying Mr. Azeff, his former university fraternity brother and a former CIBC broker, with undisclosed material information about various transactions. The OSC alleges Mr. Azeff would take that information and buy large volumes of shares. Mr. Finkelstein would then allegedly deposit large numbers of hundred dollar bills into his own bank accounts. Obviously, Mr. Finkelstein was under a duty of strict confidentiality. Even though Mr. Azeff did not have a direct relationship with any of the companies he allegedly traded in, anyone who traded on information from Mr. Azeff -- or who knew that Mr. Azeff received information from Mr. Finkelstein -- would have been in a special relationship with the company and therefore liable for insider trading. Mr. Finkelstein was capable of spreading his liability like a virus through Mr. Azeff's investment advice.

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