News

Amaya CEO charged with insider trading

23 March 2016
By Gary Trask

A Quebec securities regulator announced today that David Baazov, president and CEO of Amaya Gaming Group, and his business associates are facing 23 charges for allegedly using "privileged information pertaining to the securities of Amaya for trading purposes" and "influencing or attempting to influence the market price" of Amaya.

Autorité des marchés financiers (AMF) said in a statement that the transgressions took place between December 2013 and June 2014. Amaya, the world's largest online gaming company, acquired PokerStars and Full Tilt Poker from the Rational Group for $4.9 billion in June, 2014.

"We have made suppressing illegal insider trading and market manipulation a top priority, as this type of conduct profoundly affects public confidence and the integrity of our markets," said AMF President and CEO Louis Morisset.

UPDATE - March 29, 2016 - Amaya Gaming announces Baazov will take "voluntary leave of absence."

Five of the charges were levied at Baazov while the others were directed at Amaya Vice President Benjamin Ahdoot, financial advisor Yoel Altman, Diocles Capital, Sababa Consulting and 2374879 Ontario.

Baazov immediately denied the allegations and, in a statement, Amaya said it "believes they are without merit and expects Mr. Baazov will be fully exonerated."

"David Baazov has the full support of the independent members of the board," said Dave Gadhia, Amaya's lead director and independent board member. "As noted previously, Amaya conducted an external internal review, supervised by its independent board members with the assistance of external legal counsel."

"This review found no evidence of any violations of Canadian securities laws or regulations. The independent members of the board received and reviewed the information and concluded that no action should be taken. We have not been provided with any new information upon which the AMF's allegations of infractions are based."

Amaya went on to say it did not anticipate the charges would have any impact on the management or day-to-day affairs of the operating business.

"Operations continue as usual and there will be no change to the PokerStars or Full Tilt product offerings, either in customer experience, player fund security or game integrity," the press release states. "Amaya will continue to communicate with its regulators and does not currently anticipate any material negative impact on its current or potential licenses, approvals or partnerships as a result of the allegations against Mr. Baazov."

Despite the denial, Amaya stock fell more than 21% following today's announcement.

According to his bio on the company's website, Baazov started Amaya’s business in the mid-2000s, and under his leadership the company "has become a global gaming leader through a combination of organic growth and strategic acquisitions, including through the acquisition of its consumer technology business, which resulted in Amaya becoming the world’s largest publicly traded online gaming company."

Earlier this week, PokerStars made its return to the U.S., when it went live in New Jersey.