Scotiabank says it has no plans to change the DB&G brand. - File
Barbara Gayle, Staff Reporter
The Conduct Review Committee of the Jamaica Stock Exchange (JSE) has set up a disciplinary committee chaired by Hilary Phillips, Q.C., to determine whether disciplinary proceedings should be instituted against stockbroker Dehring Bunting and Golding (DB&G) arising from allegations of front-running made by a client.
The hearing was initially set for April 27, but has been put off to June 11.
The client, Bruce Stephen-Miller, who says DB&G has been his broker since 2004, is contending that on July 4 last year, he requested that the firm purchase 100,000 shares on the JSE, a $1.2 million transaction.
He is alleging that instead of satisfying the purchase request, DB&G bought 50,000 shares on his behalf and allegedly acquired the rest for itself.
DB&G is now majority owned by Scotiabank Jamaica, which acquired 68 per cent of the company last year for more than $4 billion.
According to Stephen-Miller's lawyer Oswest Senior-Smith, under Section 41 of the Securities Act, a stockbroking firm which is found guilty of any illegal act is subject to prosecution in the Supreme Court before a judge without a jury and if convicted can be fined.
He also explained that front-running is described in the law as 'an illegal practice of stockbrokers executing orders on a security for their own account and thus affecting prices before filling orders previously submitted by their customers'.
Stephen-Miller made a report to the JSE which wrote to DB&G in January this year suggesting that it settle the matter amicably.
The issue was not resolved and the JSE referred the matter to the Conduct Review Committee.
Said the JSE: "given that there seems to be a charge to which DB&G is answerable that the priority of trade given to the principal member instead of the client, whether through a mistake or not, the general manager of JSE is recommending that the Conduct Review Committee consider the issue and make a determination."
The Conduct Review Committee considered the issue and sent the matter to the disciplinary committee.
barbara.gayle@gleanerjm.com
