Home » Business » Investigations into H.J. Heinz Company (NYSE:HNZ) trades lead trail to London

Investigations into suspicious trades just before the acquisition of H.J. Heinz Company (NYSE:HNZ) in a deal worth $23 billion has been escalated by the Securities and Exchange Commission, a report said.

There was a spike in the trading volumes of options in Heinz just a day before the deal was announced and this attracted the attention of regulators. The investigations are now focussing on the execution of the trades via a complex derivatives bet routed through London, the New York Times said, quoting sources.

Recently there was regulatory action against a Goldman Sachs account that had bought Heinz options contracts. The Federal Bureau of Investigation has also opened a criminal inquiry in the matter.

Wall Street’s self-regulatory body, The Financial Industry Regulatory Authority had recently referred the suspicious trades to the SEC, which is now examining the volatility in ordinary stock trades.

According to the NYT report the particular product that the SEC is looking at is called contract-for-difference, a derivative that allows investors to bet on changes in the price of stocks without owning the shares.

In the case of the Goldman Sachs accounts, here regulatory action was taken, the options trade were routed through its account in Zurich, where users are permitted to maintain their accounts without fear of being identified.

NYT said that Goldman Sachs, which has not been accused of wrongdoing has hired an external counsel to advise it on the situation.

The Ultimate Cheat Sheet to "HNZ Group Inc." (HNZ) Stock

This free Special Report reveals:

1) 97% Accurate Trading Signal For "HNZ Group Inc." (HNZ) With A 2 Year Signal History.
2) Same Trading Signal Used By Hedge Funds which Cogo News Provides You For FREE

Enter your email below for immediate access.

Your information is safe with us and will not be shared with any third party.

No comments yet... Be the first to leave a reply!