In 2023, the DFSA registered a total of 260 cases of potential violations of the EU Market Abuse Regulation. Among these, 132 cases concerned insider trading, with 15 resulting in the opening of police reports by the Special Crime Unit (SCU) of the Danish police. Notably, there has been a significant increase in the number of police reports on insider trading, from 2 police reports filed in 2021 to 15 in 2023, marking a 750% rise. The DFSA has however explained that the increased number of reported cases is due to a single large case including several persons.
Among the 260 cases registered for potential violations of the EU Market Abuse Regulation, 109 were filed based on market manipulation, with only 3 of these cases being reported to the SCU. Notably, there was a decrease in the number of police reports concerning market manipulation. In 2021, 7 police reports were filed, but this number dropped to 3 in 2023. The DFSA indicated that the decrease in the number of reports filed to the police was due to an increased focus on wash trading. A wash trade is when the same investor acts as both the buyer and the seller in a transaction, resulting in no change of ownership of the financial instrument. The DFSA recently warned investors and published a memo on best practices for preventing wash trades.
In 2023, the DFSA opened 55 cases on potential violations of general disclosure obligations (takeovers, major shareholder notification, inside information and PDMR) pursuant to the EU Market Abuse Regulation. 27 of those 55 cases were related to the specific obligation to disclose inside information. In contrast, only 8 cases in 2021 were related to the specific disclosure of inside information. Consequently, from 2021 to 2023, there has been an increase in DFSA’s focus towards issuers’ compliance with the MAR disclosure obligation with an increase of nearly 300% in opened cases regarding the obligation to disclose inside information from 2021 to 2023.
Of the 27 cases, only 2 resulted in reprimands or orders by the DFSA. None of the cases opened by the DFSA in 2023 resulted in an administrative fine or were reported to the SCU. Consequently, it can be inferred that the DFSA has adopted an attitude towards issuers, where they enter into dialogue to understand the case fully before issuing a reprimand or order.
The status of the 25 remaining cases is unknown; it remains to be seen whether these cases will result in reprimands or orders or be dismissed.
Link to the newsletter from the DFSA can be found
here and the underlying statistics can be viewed
here.
