Court Documents Reveal Targets Of AMF Amaya Probe

Amaya’s David Baazov, whose records and communications were seized by the AMF in December, has said his company has nothing to hide. (Image: reviewjournal.com)

New light has been thrown on the ongoing securities fraud investigation centered on Amaya Inc and the trading of its stock in the lead up to its acquisition of .

The removal of a publication ban on a search warrant filed by Quebec financial regulator Autorité des Marchés Financiers (AMF) reveals a clearer picture of the individuals targeted by the investigation.

The document, which was cleared for publication by a Quebec court last week reveals that the AMF seized the computers, e-mails, and phone records of three Amaya officials, including its chief executive officer, , and chief financial officer, Daniel Sebag, when the company’s Montreal offices were raided in December 2014.

A senior executive, a broker and a broker’s assistant at Canaccord Genuity Corp, Amaya’s deal adviser, were also a target of the probe, according to the document, as were 15 brokers at the Montreal branch of financial adviser Manulife Securities, which was not directly involved in the acquisition process.

According to an affidavit that was released from a publication ban in June, the AMF was alerted to alleged irregularities by two whistleblowers, one of whom was a Manulife employee.

While names have been redacted from the newest document, the Globe and Mail newspaper has revealed the identities two of the Canaccord employees under scrutiny as Stuart Raftus, CEO of its wealth management unit, and broker Peter Kirby.

According to the newly published warrant, the AMF is also examining the suspicious trading of Amaya stock by more than 40 Canaccord clients. A Globe and Mail source claims that the vast majority of these clients were Kirby’s.

“The investigation reveals that certain individuals in possession of privileged information transmitted that information to several people,” wrote the AMF in the affidavit. “These people then took advantage of that information and traded on Amaya shares.” 

Amaya has traded on Toronto Stock exchange since 2013, and its shares had performed unspectacularly until the beginning of May 2014, just weeks before the shock announcement of its leveraged takeover of the Oldford Group, the owner of PokerStars.

In the weeks before the news of the deal broke, its share prices almost doubled, shooting up 14 percent in one day alone.

Amaya has consistently denied any wrongdoing, and emphasizes that no allegation has been made by the AMF about any Amaya member of staff.

“I would say that the investigation for us is something that we anticipated given that there was a historical stock run-up in advance,” said David Baazov recently. “I think the AMF is looking into something that they should be looking into and looking into what has led to that stock run-up.

“We have no evidence to believe that there’s any wrongdoing by any officer, director, or employees and we’re cooperating with the investigation.”