Ex-boss faces 10 years’ jail for allegedly buying up nearly 2 million shares before the company would reveal a significant acquisition.
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A former chief executive of Nova Minerals Ltd (ASX: NVA) has pleaded guilty to charges of insider trading and manipulating the share market.
The County Court of Victoria heard that Avrohom Mordechai Kimelman of St Kilda East, Victoria allegedly conspired with others in November 2015 to manipulate the shares of Nova, which was then known as Quantum Resources Ltd.
He later became both the chief executive officer and a board member of the business.
The Australian Securities and Investments Commission alleged that Kimelman knew non-public information that Quantum was about to acquire Manitoba Minerals Pty Ltd, which itself had a deal to buy into a lithium resource in Canada.
Kimelman is accused of using that inside information to buy 1,990,963 shares in Quantum over 8 days in April and May 2016.
The former executive faces 10 years in prison for the offences.
The maximum penalty for insider trading was increased to 15 years’ jail in 2019, but cannot apply in this case as the alleged acts were committed before the change.
Kimelman first appeared before the Perth Magistrates’ Court last year in relation to this case. He will appear at the Melbourne County Court on 23 February for a plea hearing.
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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.