A company in which Toll Holdings managing director Paul Little is a director bought Toll shares shortly before Toll signed a deal to sell its New Zealand rail assets to the Government for $665 million.
Fresh questions are also being raised about the price the Government paid andwhether it was naive in buying Toll's spin that the Australian company was a reluctant seller.
Highly placed sources have said that Toll's supposed reluctance was "the con job of this century".
Mr Little told the Australian stock exchange on April 18 that two days earlier, a company of which he was a shareholder and director, Namarong Investments, bought 131,500 Toll shares at an average price of A$7.62 ($9.33).
On April 29, he disclosed the purchase of 129,000 Toll shares a week earlier at an average price of A$7.67.
Before April, Namarong already had more than 900,000 Toll shares.
Toll shares had fallen from A$14.36 on June 14 to their lowest since August 2006, but ahead of and after news of the New Zealand sale announcement on May 5 they rose again.
They hit A$8.78 on May 6, rising A50c the day after the announcement - creating a paper profit for Namarong of nearly A$300,000 on the April share purchases.
The shares were trading at A$8.30 yesterday and no recent sales by Namarong have been recorded.
A possible sale of Toll NZ has been public knowledge since December 5 and from early March, news reports showed a deal was close.
Toll Holdings' annual report states directors and executives are prohibited from trading in the company's securities whenever they have price-sensitive information which is not generally available.
A Toll media manager, Andrew Ethell, said Mr Little understood the insider trading rules.
"April 22 is a long time before May 5. He clearly didn't do anything that was going to be a problem."
Shareholders Association chairman Bruce Sheppard said the more important issue was that the Government had failed to notice a very large inter-company debt.
Sources say the Government has underestimated the costs despite Michael Cullen calculating all-up costs at more than $1 billion.
