ASIC bans former fund manager for three years

Oksana Patron

23 May 2023

The Australian Securities and Investments Commission (ASIC) has banned former Gleneagle Securities fund manager, Gregory Tolpigin, from providing financial services for three years for naked short selling.

Naked short selling is a practice when a person sells certain financial products such as shares that are not held and cannot be transferred to a buyer at the time the person places the sell orders.

According to the regulator, Tolpigin engaged in the naked short selling of shares on 150 occasions totalling over $7 million from between January and August, 2021.

Tolpigin, who did not own or borrow the shares at the time he placed the orders to sell them, sold shares on the Australian Securities Exchange (ASX) through accounts held with Gleneagle Securities and associated entities.

ASIC said that Tolpigin’s sales risked settlement failure in the event that he was unable to buy the shares back prior to settlement, for example if the shares had been suspended from trading.

Therefore, in addition to being banned from providing financial services, Tolpigin has been also banned from controlling a financial services business or performing any function involved in carrying on a financial services business as an officer.

The regulator said it viewed the prohibition on naked short selling as an essential policy for the maintenance of financial market integrity.

“It reduces the risk of settlement failure, distortions to the operation of financial markets and abusive short selling that can artificially depress prices. It also improves the accuracy of information available to the market. ASIC will continue to identify non-compliance and take enforcement action where necessary,” it said in the statement.