Wednesday 14th June 2017
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Eroad, the logistics and fleet management software developer, says former senior employee Jeffrey Peter Honey is no longer employed by the company after his sentencing for insider trading yesterday.
Honey, who was an insights and analytics manager at Eroad, pleaded guilty to a charge of insider trading in April and was yesterday sentenced to six months home detention. Another person involved, who has interim name suppression, still faces one charge of insider trading under section 241 Financial Markets Conduct Act – namely, “information insider must not trade”. That defendant is yet to appear before the Auckland District Court and has applied for permanent name suppression.
Honey texted confidential company information about Eroad’s performance in the period ended Sept. 30, 2015 to a former staffer, then suggested the staffer sell Eroad shares. The staffer then traded 15,000 shares. Eroad posted a profit of $611,000 in the six months ended Sept. 30, 2015, from a year-earlier loss of $1.9 million. Sales jumped 55 percent to $12.2 million.
In a statement, Eroad said Honey no longer works for the company, and said he “was not a senior employee in Eroad’s business as has been reported by some media outlets”. However, when Honey joined Eroad in 2014, the company described him as one of several "key appointments … creating a deeper profile to our senior management team for the business."
"Jeff's appointment enables Eroad to build capability in data analytics" with his background in insights and analytics including senior roles at BNZ and Vodafone, it said at the time.
Chief executive Steven Newman said the company was disappointed the offending had occurred, and had fully supported the Financial Market Authority's investigation. The court and the FMA had commented on the strength of the company's internal controls and the FMA had drawn extensively on the training and materials the company gives to employees in its evidence, he said.
"We’re pleased the court and the FMA have recognised Eroad’s commitment to protecting the integrity of New Zealand’s financial markets. We continue to offer all staff extensive compulsory training on the importance of complying with the law when trading in Eroad securities," Newman said.
Eroad shares last traded at $1.70, having sold at $3 apiece in its 2014 initial public offering. The shares traded as high as $4.19 in March 2015 before slumping to $2.66 as at Sept. 30, 2015.
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