Debt buyback: Prosecutor requested to subpoena CNV head, lift stock market secrecy

The measures were decided after a lawyer asked a prosecution office to investigate whether the alleged leak of information regarding the sovereign bonds came from the government.

Prosecutor Ramiro González today asked judge María Eugenia Capuchetti to order the lifting of sovereign bond purchasers’ stock market secrecy, amid the investigation of possible leaks of information regarding the debt buyback announced last week.

The measure will reach individuals and stock brokers who bought bonds that are being bought back by the government before the announcement last Wednesday. The prosecutor also asked Capuchetti to subpoena the head of the National Securities Commission (CNV), Sebastián Negri, to testify about the office’s ongoing investigation into the matter, which was ordered by Economy Minister Sergio Massa. 

The prosecutor also suggested that Judge Capuchetti request reports from the Central Bank and the Economy Ministry on the subject.

The case, run by Capuchetti at the Criminal and Correctional Federal Court #5, is investigating possible “fraud against the public administration, secrecy violation, abuse of authority and violation of public official’s duties.”

González’s decisions were made after a complaint filed by lawyer Ignacio Abel Uriburu on January 20. In his presentation, Uriburu told the prosecutor’s office there were “enough signs” that “officers from the Economy Ministry’s upper echelons violated their duty of keeping the secret, and communicated to operators in the capital market that a sovereign bond buyback was to take place” before it was officially announced.

Uriburu also stated that people who bought the bonds before the announcement “abused privileged and illegal information”, and purchased the financial instruments with the certainty that in the next few days, their price would skyrocket.

Among the alleged hints, Uriburu mentioned a “suspicious” increase in the historical volume of GD30 bond purchases. The purchase volume of bonds AE38, AL35 and AL41D also spiked in the days prior to the announcement, according to the lawyer.

Another lawyer, Alejandro Kalbermatten, filed a complaint on the matter days after Uriburu, and both were later unified. In his presentation, Kalbermatten quoted a tweet by economist Alfonso Prat Gay, a former Finance Minister during Mauricio Macri’s administration, which read “let’s hope no government official has bought those bonds recently.”
Meanwhile, the investigation at the CNV is still ongoing. Yesterday, two of Argentina’s top 10 stock brokers testified before the commission, and individual traders are expected to follow suit next week. Moreover, as the Herald reported, the CNV is seeking to expand the current information exchange deal with the United States Securities and Exchange Commission (SEC) to obtain further data. 


All Right Reserved.  Buenos Aires Herald