ASIC has banned Anton Kerstens of North Sydney from providing financial services for five years, after an investigation found dealings by his company had manipulated the price of shares in Cauldron Energy.

Mr Kerstens, 56, worked as a securities dealer in Sydney and Perth from the late 1970s and had a long standing relationship with Cauldron Energy, a West Australian uranium exploration company.

ASIC’s investigation found that for a period of almost five months in 2012, Mr Kerstens was involved in numerous dealings through his company, Ark Equities, which had the effect of supporting the price of Cauldron Energy shares at a time their price was falling. ASIC found that these dealings created a false and misleading appearance of the price for the shares in Cauldron Energy, and were intended to affect the trading behaviour of others in the market.

ASIC’s investigation also found that although some of Ark Equities’ clients genuinely wanted to accumulate shares in Cauldron Energy, Mr Kerstens’ dealings were not consistent with a legitimate strategy to buy the maximum amount of shares at the best price.

Commissioner Cathie Armour said, ‘ASIC will pursue people who are involved in manipulating the price of or demand for shares. Such failures to comply with financial services laws seek to undermine the integrity of our markets, and ASIC will take action against the individuals involved.’

Mr Kerstens has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC’s decision.

Background

Mr Kerstens is the sole director and officer of Ark Equities, and the company’s dealing business was entirely run and controlled by Mr Kerstens.

The dealings conducted by Mr Kerstens through his company included:

• small volume trades which caused the vast majority of price increases and, in particular, increases just before market close
• a pattern of opening and frequently amending orders which were never filled, and
• a pattern of repeatedly, and in quick succession, placing and deleting orders.

ASIC found that, in combination, Mr Kerstens’ activities created a false and misleading appearance of the price for and the market for the Cauldron Energy shares, and that they were intended to affect the trading behaviour of others in the market.

Editor's Note 1:

On 19 April 2015, Mr Kerstens lodged an application for review of ASIC's decision with the Administrative Appeals Tribunal (AAT).

Editor's Note 2:

On 11 April 2016, the hearing of Mr Kerstens' review application commenced in the  AAT. On 13 April 2016, it was adjourned, part heard, to 6 June 2016.

Editor's note 3:

On 1 June 2016, following receipt of written notification from Mr Kerstens that he wanted to withdraw his application, the AAT dismissed MR Kerstens' review application and closed the file.