SEC junks Syjuco claim of insider trading

The Securities and Exchange Commission said yesterday that if found no basis to uphold Iloilo Rep. Augusto Syjuco’s claim that RFM Corp. of Cosmos bottling Corp. had violated stock market rules on insider trading and public disclosure.

SEC Commissioner Joselia Poblador said that unless verified evidence to the contrary is presented and proven by the commission’s investigation process, it can be reasonably observed that the rise in the volume and price of Cosmos shares could very well be explained by the availability of information to the public made possible by full public disclosures preceding volume and share price movements.

Syjuco earlier accused the RFM-Cosmos group of resorting to illegal insider trading and stock price manipulation to prevent a further free fall of their publicly-listed companies in violation of the Securities code. In line with his accusations, the Iloilo solon made formal presentations with the SEC which were followed by similar presentations by the RFM group to air its side.

Poblador, in a letter to Syjuco, said that the commission does not have any sufficient reason to ignore the material sequence of public disclosures reported widely and almost daily in national newspapers since June 2001 by the RFM-Cosmos group regarding the planned sale of shares to San Miguel Corp.

The commissioner said that the public disclosures were made earlier than, rather than after, the increases in the volume of transactions and price of shares of Cosmos.

The SEC official also said that there is also no basis right now to conclude insider trading, stock manipulation, and suspension of the trading of listed stocks of RFM and Cosmos Bottling.

Syjuco claimed in his informal presentations to the SEC that there were transactions made by the RFM group, through corporations or individuals acting as its dummies, to create an artificial price for Cosmos shares.

Poblador said that the list of the shareholders representing about 18 percent of total provided by Cosmos does not bear out Syjuco’s allegation that half of said public holding is owned by Cosmos/Concepcion through dummies.

"It will take a presentation of verified evidence and subjecting the same to our investigation process before justifying or ruling our conclusions of insider trading, stock manipulation, and suspension of trading of listed stocks of RFM Corp." she said.

The commission also stressed that it does not and will not interfere with anything related to the civil action filed by Syjuco against the Cosmos group.

As far as issues attending the sale of Jaz Cola Group to the Concepcions, Poblador said that the commission can no longer entertain the same in the light of the passage of the Securities Regulation code removing the SEC’s power to adjudicate cases of this nature.