FMA says Milford probe in 'final stages'

Anthony Quirk, managing director of Milford Asset Management. Photo / NZ Herald

The Financial Markets Authority says it has reached the final stages of its investigation into alleged market manipulation at Milford Asset Management and is "engaging with the parties based on our findings".

"We hope to be in a position to make a statement in the near future," said spokesman Andrew Park.

Two months have now passed since the FMA said in early April that it expected to wrap up the investigation in "a few weeks".

Auckland-based Milford, which has more than $3 billion under management, confirmed in February that an employee was being investigated over certain trades.

The investigation is understood to have begun around the middle of last year.

Market manipulation involves deliberate attempts to interfere with the market to create artificial, false or misleading appearances in supply, demand or the price of securities.

A market source, who did not want to be named, said the investigation had been hanging over Milford and the wider industry and it would be good to see it brought to a conclusion.

Under the Financial Markets Conduct Act, an individual convicted of market manipulation can be jailed or fined up to $500,000, while a company can face a fine of up to $2.5 million.

In April the New Zealand Superannuation Fund suspended Milford's $281 million active equities mandate until the probe was completed.