Wed, Oct 03, 2007
Chairman Gallois Calls Findings "Preliminary"
In what analysts see as a tremendous blow to aerospace giant
EADS, the French government says investigators have determined
"massive insider trading" was conducted by 21 top managers in both
2005 and 2006.
The Associated Press reports investigators point to the way EADS
executives sold some of their shares in the Airbus parent as a
strong indicator of insider trading.
Expecting company shares would fall, the French government
accuses them of selling "forward" -- scheduling 2007 transactions
at higher 2006 prices. Investigators say that's a good indication
those managers knew of trouble on the horizon and were trying to
protect their own financial positions.
Investigators at the French Financial Markets Authority are
forwarding the allegations to prosecutors in Paris, saying in
a statement that the facts in this case are "likely to be qualified
as criminal," according to the AP.
EADS CEO Louis Gallois
says the findings are "preliminary" in nature.
Shares in French EADS partner Lagardere appear to have taken the
largest hit from the news. Fears of a looming insider trading
scandal caused stocks to dip six percent in trading Wednesday,
according to Thompson Financial.
Rumors of insider trading at EADS first surfaced in May 2006,
when several top-level executives sold off their shares at just the
right time... right before news of a second delay to the Airbus
A380 program became public.
As ANN reported, the ensuing
scandal led to the resignations of former EADS co-CEO Noel Forgeard
(shown at right) and Airbus chief Gustav Humbert... and prompted
investigations from both French and German sides of the aerospace
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