Former Milford Asset Management portfolio manager Mark Warminger has been ordered to pay $400,000 after the High Court ruled he manipulated the New Zealand stock market on two occasions in 2014.

In May, Chief High Court Judge Geoffrey Venning found Warminger manipulated the market in two trades while rejecting eight other instances brought before the court by the Financial Markets Authority. The hearing was a civil case, meaning the judge had to decide on the balance of probabilities.

Warminger is appealing the judgment, with the FMA cross-appealing. The market watchdog said today it is "currently considering the penalty judgment".

The starting point for the penalty was $500,000, and the judge applied a reduction of $100,000 to recognise Warminger's "personal circumstances". Warminger can no longer work in the financial sector, as he has done for nearly 20 years, and recent medical issues mean he is "unable to carry out other employment for which he is qualified, at least for a significant period of time", leading to the discount, the judge said.


As a result of the pecuniary penalty order, Warminger automatically received a five-year management ban. Had Warminger been prosecuted, the criminal penalty for his actions would have been a maximum fine of $300,000, or five years imprisonment for each contravention.

The maximum penalty for a breach of the law is the greater of the consideration for the transaction, three times the amount of gain made or loss avoided, or $1 million. The Financial Markets Authority, which brought the case against Warminger, argued the maximum penalty the judge could impose was $3.8m, while Warminger's lawyers argued the maximum penalty would have been $2m.

Warminger's employer at the time, Milford Asset Management, reached a settlement with the FMA before the trial. It paid $1.1m in lieu of a pecuniary penalty, along with $400,000 in costs.

Justice Venning said he accepted Warminger hadn't made any significant material gain from his conduct, with at most $16,000 made from one transaction.