HONG KONG: US investment fund giant Fidelity Management on Thursday defended a Hong Kong portfolio manager charged with insider dealing, saying he "did not violate any laws or regulations."
The comments come after documents revealed on Wednesday that the city's financial secretary has accused George Stairs of improperly trading shares in Chinese food giant Chaoda Modern Agriculture.
The Chinese firm's chairman Kwok Ho and chief financial officer Andy Chan were also charged in the case for allegedly supplying Stairs with inside information before a share offering in June 2009.
A Fidelity spokesman said in an email that the fund company had a "zero-tolerance policy" on insider trading, but added that an internal probe already cleared Stairs over his trading of Chaoda shares.
"Fidelity conducted a thorough internal review of this matter in 2009 consistent with its strong protocols around material non-public information," the spokesman said.
"We continue to believe that Mr. Stairs did not violate any laws or regulations," he added.
Stairs remains a Fidelity employee "in good standing" who has taken up a new research position at the company, he said.
The claims, detailed in a notice posted to the city's Market Misconduct Tribunal, said Stairs improperly traded Chaoda stock before and after a HK$1.78 billion ($229 million) share sale in June 2009.
Acting on insider information from Kwok and Chan, Stairs allegedly sold HK$1.98 million worth of Chaoda shares at HK$5.30 each before the placement and bought back HK$2.90 million worth of shares at HK$4.60 after the sale.
The pair "knew or had reasonable cause to believe that Stairs will make use of the relevant information to deal in shares of Chaoda," the documents said.
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