Mr Gay is the most senior executive to be convicted of insider trading in Australia.

Ms Armour said maintaining confidence in the integrity of the market was ASIC’s priority.

Mr Gay was convicted on the basis that he ought to have known the information was inside information, not that he knew.

‘The conviction of Mr Gay sends a message to directors to carefully consider the information they possess when making a trading decision,’ Ms Armour said.

‘Company policies on trading windows are not a protection for trading when a director possesses inside information.’

More broadly, Ms Armour says insider trading convictions demonstrate ASIC’s success in fighting this crime.

‘Prosecuting insider trading has been a real focus for ASIC. Our ability to see trading as it occurs, to look out for trading in stocks we know are in play, and to invoke our investigatory powers early has meant ASIC is a credible insider trading enforcement agency,’ Ms Armour said.

Earlier this month former Royal Bank of Canada employee John Kay Jin Khoo was jailed for 14 months (refer: 13-209MR) and in June 2013 former PwC tax consultant Nicholas Glynatsis was sentenced to six months in jail (refer:12-313MR). These followed the sentencing of former Hanlong Mining executive Calvin Zhu in February 2013 to 15 months jail (refer:13-027MR).

Mr Gay, who was chairman of Gunns from 2002 to 2010, pleaded guilty earlier this month (refer:13-204MR).

On 2 and 4 December 2009, while in possession of inside information relating to the financial performance of Gunns, Mr Gay placed orders to sell more than 3.4 million Gunns shares. This trading was prior to the release of Gunns’ half year results on 22 February 2010. Following this release, the Gunns share price fell substantially.

Appearing via video link at the Supreme Court of Tasmania in Launceston, Mr Gay was convicted and fined $50,000. As a result of his conviction, Mr Gay will be automatically disqualified from managing corporations for five years.

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Mr Gay, who was a director of Gunns Limited from 1980 to 2010 and was chairman of Gunns Limited from 2002 to 2010, was charged in December 2011 (refer: 11-296AD).

On December 2 and 4, 2009, while in possession of inside information relating to the financial performance of Gunns, Mr Gay sold more than 3.4 million Gunns shares. This trading was prior to the release of Gunns’ half year results on 22 February 2010. Following this release, the Gunns share price fell substantially.

The matter will return to the Supreme Court of Tasmania in Launceston on 14 August 2013 for sentencing submissions. ASIC has no further comment on the matter at this time.

The Commonwealth Director of Public Prosecutions is prosecuting the matter.

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