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New Zealand regulator fines First NZ Capital for rule violations

The New Zealand Markets Disciplinary Tribunal publicly censured and fined First NZ Capital Securities Ltd. NZ$45,000 for violating several rules in connection with a complex trade of Auckland International Airport shares in December 2016.

The NZ Markets Disciplinary Tribunal is an independent regulatory body established under the NZ Markets Disciplinary Tribunal Rules.

In a Sept. 3 statement, the tribunal said it approved a settlement agreement between NZX Ltd. and First NZ Capital on Aug. 28. Under the agreement, First NZ Capital admitted it breached several listing rules when it accepted an order on Dec. 30, 2016, with complex instructions to sell Auckland International Airport, or AIA, shares, with volume restrictions and limits to how the order could be traded. The company decided to accept the order despite the stock exchange having an abbreviated trading day on Dec. 30, 2016.

The tribunal said First NZ Capital's trading in AIA shares was inconsistent with recent trading in the company's shares and impacted the market with the price of AIA's ordinary shares falling 4.4% from receipt of the order to sell to market close. First NZ Capital failed to appreciate the risks of proceeding with the complex order given the limited time frame available.

As part of the settlement agreement, First NZ Capital will also pay any costs of the tribunal and NZ$18,000 for NZX Ltd.'s costs.

As of Aug. 31, US$1 was equivalent to NZ$1.51.