OREANDA-NEWS. August 17, 2015.The Bank of Russia established a fact of repeated and continuous abuse of the markets of investment units of Centre, closed-end rent unit investment fund (rent CUIF), and Malakhit, rent CUIF, during the trading on CJSC MICEX SE in 2012-2014, and the market of investment units of Strazhi Urala, real estate CUIF, during the trading on CJSC MICEX SE in 2012-2013.

The trading activity in the markets of investment units of Centre, rent CUIF, and Malakhit, rent CUIF, during the period under consideration was fully maintained by the following interconnected entities: CB Koltso Urala LLC, Regional AVK LLC, REA Delovoy Dom LLC, Solutions and Investments LLC and CJSC Uralleasing, also connected with the management company of the said funds MC Sodruzhestvo LLC. They bargained by prior agreement.

Pursuant to Clause 2 of Part 1 of Article 5 of Federal Law No. 224-FZ, dated 24 July 2010, ‘On Counteracting Illegitimate Use of Insider Information and Market Abuse and Amending Certain Laws of the Russian Federation’ (hereinafter, Federal Law No. 224-FZ), deals executed by the said entities with investment units of Centre, rent CUIF, and Malakhit, rent CUIF, during the period under consideration which resulted in considerable deviation of price and/or volume of trading of these investment units are considered to be market abuse.

Besides, some deals with investment units of Centre, rent CUIF, and Malakhit, rent CUIF, repeatedly made by the said entities on certain trading days of the period under consideration which resulted in considerable deviation in price of these investment units, are considered to be market abuse pursuant to Clause 6 of Part 1 of Article 5 of Federal Law No. 224-FZ.

The trading activity in the market of investment units of Strazhi Urala, real estate CUIF, during the period under consideration was fully maintained by the following interconnected participants: CB Koltso Urala LLC, CJSC Management Company United Investment Funds, UGMK-Strakhovanie, and Oleg Pelikh, also connected with the management company of the said funds MC Sodruzhestvo LLC. They bargained by prior agreement.

Some deals with investment units of Strazhi Urala, real estate CUIF made by CB Koltso Urala LLC, CJSC Management Company United Investment Funds, UGMK-Strakhovanie, and O.A. Pelikh during the period under consideration resulted in considerable deviation in price of these investment units, and considered to be market abuse pursuant to Clause 2 of Part 1 of Article 5 of Federal Law No. 224-FZ.

Market abuse is a gross violation of the Russian legislation.

It should be noted, that Centre, rent CUIF, and Malakhit, rent CUIF, terminated their activity shortly after the MC Sodruzhestvo LLC received Bank of Russia instructions to provide documents regarding trust management of these funds.

The Bank of Russia took a decision to cancel licence to carry out professional activity in the securities market of CJSC Management Company United Investment Funds.

Bank of Russia cancelled qualification certificates of financial market specialists of the officials involved in deals made by professional securities market participants which resulted in the abuse of markets of the said investment units.

Administrative measures were applied to some officials involved in the abuse of markets of the said investment units.

The Bank of Russia sent the persons who had manipulated the markets of the said investment units, instructions on non-admission of similar violations in future.