Bell Potter trader Damien Rodr changed his evidence at the eleventh hour after caving into pressure from Bell Potter managing director and former Wallabies captain Simon Poidevin and threw himself under the bus, the corporate regulator alleges.
In the closing submission on Monday, Norman O’Bryan, SC, representing the Australian Securities and Investments Commission, said Mr Rodr “succumbed” to the pressure placed on him by Mr Poidevin and decided to incriminate himself.
“He’s jumped under the bus to take the hit for Poidevin,” Mr O’Bryan said.
Both Mr Rodr and Mr Poidevin are challenging the corporate regulator’s financial services licence ban after the regulator found they engaged in market manipulation of the share price of fintech company DirectMoney.
A crucial piece of evidence in this case was a recorded telephone call between Mr Rodr and Hong Kong-based director of institutional broking Dan Kirton on July 14, 2015.
Incredible turn of events
In that conversation, when Mr Kirton says: “F—, another shit day for DM1”, Mr Rodr replies: “I was trying to … keep some in the tin … under my volume, but Poido [Mr Poidevin] kept ringing when they were 13-and-a-half, he wanted me to get them back up to 14 and stuff like that.”
The telephone call took place the day after DirectMoney debuted on the ASX and closed at 17.5¢, below the offer price of 20¢.
The next day, Bell Potter decided to invest $200,000 of its own money into DirectMoney and directed Mr Rodr to buy the stock over the following week, but without buying more than 20 per cent of the trading volume in any given day.
In what Mr O’Bryan described as an “incredible” turn of events, Mr Rodr told the tribunal earlier this month he decided to lie to Mr Kirton about being pressured by Mr Poidevin because that’s what “he [Mr Kirton] wanted to hear”.
However, Mr O’Bryan said Mr Rodr’s evidence, given three years after the conversation took place, was not credible.
“At the very end of this case his memory has suddenly clarified … he can now remember,” he said.
He said Mr Rodr’s evidence showed many of the characteristics of market manipulation, including the fact he made small, multiple transactions designed to cause upticks in the share price.
However, Mr Poidevin’s barrister said there was “strong, compelling” evidence of Mr Poidevin’s attitude towards manipulative trading when on the day of the float Mr Poidevin resisted pressure from Mr Kirton to use Bell Potter’s own money to prop up the share price.
Way of getting rid of Kirton
The tribunal heard earlier this month Mr Kirton, asked whether there was a facility at Bell Potter to “make it [the DirectMoney share price] close at f—ing 20” cents.
“Surely we can go f—ing $20,000 worth of stocks to close at the issue price,” Mr Kirton said, to which Mr Poidevin replied: “No, but we are allowed to support the aftermarket.”
Mr Poidevin told the tribunal he was “taken aback” by Mr Kirton’s suggestion and considered it naive, reckless and contrary to the general culture at Bell Potter.
Mr Rodr’s barrister said his client blaming Mr Poidevin was an “effective way of getting rid of Mr Kirton” and denied his evidence was an invention made up in the witness box.