Financial Crime World

SHARES SOAR: Trading Volume Surges Following Avon Offer

On the day the company made a surprise offer to acquire another firm, trading volume in Avon shares surged to an unprecedented level. A staggering 17 million shares were traded, more than quadruple the average daily trading volume in the three months leading up to the announcement.

Trading Halt

The sudden surge in trading activity prompted the New York Stock Exchange (NYSE) to halt trading in Avon shares not once, but three times throughout the day. This unprecedented move was likely intended to prevent a market meltdown as investors scrambled to react to the unexpected news.

Securities Fraud Charges

In related news, a high-ranking executive has been charged with securities fraud and other offenses following an investigation by the US Securities and Exchange Commission (SEC) and the Federal Bureau of Investigation (FBI).

Case Details

  • The defendant, a 38-year-old former investment banker, allegedly orchestrated a series of market manipulation schemes involving Avon, another company, and a tender offer.
  • Charges against the executive include:
    • Securities fraud
    • Wire fraud
    • Aggravated identity theft
  • If convicted, he faces up to 20 years in prison on each count, as well as fines of up to $5 million or twice the gross gain or loss from the offense.

Investigation and Prosecution

The case is being handled by the US Attorney’s Office for the Southern District of New York, with assistance from the SEC’s Division of Enforcement and Office of Inspector General. The investigation was part of the President’s Financial Fraud Enforcement Task Force, a coalition of federal agencies, 94 U.S. attorneys’ offices, and state and local partners dedicated to combating financial crimes.

Reaction

The charges against the executive were announced by US Attorney Preet Bharara, who praised the work of the FBI and thanked the SEC and Bulgarian law enforcement for their assistance in the arrest and apprehension of the defendant.

Conclusion

The case is a stark reminder of the importance of fair and transparent market practices, as well as the ongoing efforts to combat financial fraud and protect investors.