Paul Penna, president of Agnico-Eagle Mines (TSE) and Goldex Mines (TSE), has been charged with two counts of illegal insider trading under the Ontario Securities Act. The charges relate to two incidents in July and November of 1989, when Penna allegedly purchased Goldex shares just before drilling results from the Goldex property near Val d’Or, Que., were released to the public.
The results confirmed the presence of a low-grade gold zone, known as the Goldex Extension zone, on an 11-claim property shared by Ormico Exploration. The GE zone, which hosts preliminary reserves of 19.4 million tons grading 0.07 oz. gold per ton, is an extension of the main Goldex zone on the adjacent Dubuisson property.
Goldex, 35% owned by Agnico, recently traded at 90 cents, down from a 52-week high of $4.
Doug MacKay, legal counsel for the Ontario Securities Commission, said the maximum penalty for insider trading is $1 million or three times profits realized by the illegal trading. Repeated offences or cases involving substantial public fraud can lead to jail sentences of up to two years.
“I don’t think this case will lead to a jail sentence,” said MacKay. Although Penna is an active trader of securities he has a direct interest in, he has never been convicted of illegal insider trading.
Penna’s lawyer could not be reached for comment, but it has been reported Penna will fight the charges.
Be the first to comment on "Penna faces OSC charges"