Philip Lynch formally sanctioned for insider trading

The High Court has upheld a series of penalties recommended by a Central Bank investigation which found that a former non-executive director of the C&C drinks group, Philip Lynch, engaged in insider trading in shares of the society.

The decision marks the first time a person has been formally sanctioned after being found guilty of insider trading following such a regulatory investigation.

As a result of the decision, Mr. Lynch received a public warning, a fine of €75,000 and was banned from participating in the activities of a regulated financial services firm for a period of five years.

He must also pay €37,500 in fees to the Central Bank.

The investigation was conducted by the Central Bank’s Enforcement Division and the outcome was assessed by a panel comprising a number of senior retired judges.

It found that Mr Lynch breached market abuse regulations governing the area of ​​insider trading when he purchased 200,000 shares of publicly traded company C&C on October 21, 2008.

Inside information related to the hiring of a new chief executive for the company, John Dunsmore, senior counsel Remy Farrell for the Central Bank’s Enforcement Division told the court.

Marcus Dowling SC representing Mr. Lynch explained that his client did not object to the requested order confirming the penalties.

He said this was not a typical case, as Mr. Lynch had not profited from his investment in the company and in fact had lost significant ownership of its shares.

Mr Dowling said his client did not act secretly and advertised his trades on the market.

High Court Chief Justice Mrs Justice Mary Irvine said she saw no reason not to uphold the order sought.

A high-profile businessman, Mr. Lynch previously served as CEO of well-known companies IAWS and One51.

He is also a former chairman of the National Children’s Hospital Development Council and served as chairman of An Post and Bord Bia.

Mr. Lynch is also a former director of several other companies, including Coillte, Irish Life and Permanent and FBD.

In 2013, the Central Bank reached an agreement with C&C and fined it €90,000 for violating between January 2008 and January 2009 the insider list requirements in the market abuse regulations and rules .

He found that C&C failed to regularly and promptly update its insider list with the identities of people working for it who had access to inside information or no longer had access to inside information.

It also failed to indicate on its insider list the date of each update and to maintain a complete list of key contacts of any other entity acting on its behalf that had access to inside information.

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