CDPQ executive under investigation for alleged market manipulation
The Autorité des marchés financiers (AMF) has filed a lawsuit against Richard Guay, former head of Quebec's Caisse de dépôt et placement du Québec, seeking $2.2 million in damages. The AMF alleges that Guay used "unfair, abusive, or fraudulent practices" in stock transactions made on behalf of his children and spouse, unbeknownst to her.
The lawsuit, filed on May 15, accuses Guay of market manipulation between January 2018 and August 2022. Through this alleged manipulation, Guay is said to have obtained tax advantages of approximately $1.6 million, according to the AMF. The allegations are yet to be proven before the Tribunal administratif des marchés financiers, which is scheduled to hear the case starting June 19.
The AMF seeks repayment of the $1.6 million, along with administrative penalties totaling $550,000. They also demand a five-year ban on Guay from engaging in securities transactions and managing an investment fund. The lawsuit claims that Guay repeatedly engaged in unscrupulous stock trading practices, endangering the integrity and sustainability of financial markets.
Guay is accused of creating at least 25 accounts in the names of his three children and spouse, which he used to orchestrate transactions for his personal gain and that of his family. One of his daughters is said to have aided him in the scheme, according to the AMF. His wife was reportedly unaware of these transactions, which were discovered by AMF investigators.
In an October 2023 interview, Guay admitted to making a mistake in his actions. He served as president and CEO of the Caisse de dépôt et placement du Québec from September 2008 to November 2009 and currently serves as a professor at the Université du Québec à Montréal. Guay has held positions in pension fund committees for HEC Montréal and the Fonds HEC Montréal but resigned during the AMF investigation.
The lawsuit alleges that Guay was first warned in 2018 for practices dating back to 2014 and 2015. Instead of complying, Guay is said to have modified his strategy by using not only his own accounts but also those belonging to third parties. The AMF details a series of transactions, some made in a matter of minutes, and alleges that these manipulations allowed for the "unjustified enrichment" of his family's tax-free savings accounts while causing artificial losses in his taxable accounts.
- The lawsuit filed against Richard Guay involves allegations of market manipulation and unscrupulous stock trading practices, which fall under the category of general-news and crime-and-justice.
- Personal-finance is implicated in this case as the AMF alleges that Guay used fraudulent practices to obtain tax advantages for his family, utilizing the accounts of his children and spouse to invest without their knowledge.
- This lawsuit, which has significant implications for business and finance, also highlights the importance of ethical practices and maintaining the integrity of the financial markets, thereby impacting the wider business world.
