Financial Markets Authority files market manipulation case against Franco Belgiorno-Nettis

Auckland-based retail investor Franco Belgiorno-Nettis is alleged to have manipulated the NZX.

The Financial Markets Authority has filed civil proceedings against experienced Auckland-based retail investor Franco Belgiorno-Nettis for alleged market manipulation of shares in NZX-listed Steel and Tube Holdings Limited.

The regulator alleges that between November 2020 and July 2023, Belgiorno-Nettis made orders for Steel and Tube’s shares which repeatedly affected its closing share price, therefore likely having the effect of creating a false or misleading appearance of trading.

The Financial Markets Authority (FMA) also alleges that the orders lacked a genuine commercial purpose and that Belgiorno-Nettis deliberately took actions to increase or maintain the price of shares in Steel and Tube for his personal advantage at a time when he held a substantial shareholding in the company.

The orders were made via two broking accounts he held with ASB Securities.

The proceeding follows an investigation by the FMA after ASB had earlier reported potential concerns about the orders to NZ RegCo.

“We take cases of market manipulation seriously to ensure New Zealand’s markets reflect genuine supply and demand, in order to preserve their integrity and reputation,” said FMA head of enforcement Margot Gatland.

“Public markets are an important aspect of the capital markets ecosystem in terms of both access to capital and opportunities for investment and wealth creation.

“Investors should be careful to understand their obligations when trading online.”

The FMA is seeking a declaration of contravention, civil pecuniary penalties and costs.

Steel and Tube is not a party to the proceeding.

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