Estonian Analyst Charged with Insider Trading in Telecommunications Stocks Worth €125,000

Overview

• Dmitri Vassiljev, a former analyst at SEB Enskilda AS, charged with insider trading
• Allegations of insider trading in AS Eesti Telekom and TEO LT shares and options
• Estonia’s first insider trading case to be brought before a court

Details of the Case

Last week, Estonia joined the list of countries dealing with insider trading cases, as Dmitri Vassiljev, a former analyst at SEB Enskilda AS, was charged by the Estonian Prosecutor’s Office with insider trading. The allegations involve Vassiljev’s use of privileged access to non-public information on TeliaSonera AB’s planned buyout of minority shareholders in both AS Eesti Telekom and TEO LT to make profitable trades.

Consequences of the Insider Trading

Following the buyout offer announcement, AS Eesti Telekom experienced a 23% increase in share prices, while TEO enjoyed a 30% surge. Estimated undeclared profits generated for Vassiljev amounted to around €125,000.

Regulations and Penalties

This is the first insider trading case to be brought to an Estonian court. While the sentence specifics have yet to be determined, Estonian insider trading regulations allow for fines up to 2 million krooni (€117,000) and a prison term of up to three years.

Implications for the Financial Sector

Lohmus Haavel & Viisemann and its employees have shown concerns regarding insider trading in Estonia’s financial sector in the past. The firmer regulations that may result from this case are likely to be welcomed by them.