A former executive of hospital operator Healthe Care has been sentenced and fined $10,000 after pleading guilty to one charge of insider trading for acquiring a large number of the company’s shares while in possession of inside information regarding plans to acquire a rival hospital operator.
Gregory Campbell was sentenced to 12 months imprisonment, to be released immediately upon his own recognizance in the sum of $10,000, and slapped with a $10,000 fine. He was also ordered to a $31,996 penalty, representing the profits he made from the insider trading.
Campbell pleaded guilty in May this year after being hit with three charges of insider trading in May 2018 for trading on information regarding Health Care’s 2016 bid for Pulse Health Limited.
In sentencing Campbell, Judge McInerney of the County Court of Victoria said Campbell would have been sentenced to two years in prison with no release upon recognizance had he not pleaded guilty.
In May 2019, the Melbourne Magistrate’s Court dismissed one of the counts against Campbell on the basis that there was insufficient evidence to prove that he possessed inside information at the time he applied for 350,000 shares in Pulse on October 7, 2016. The remaining counts were committed for trial.
Pulse announced on October 20, 2016 that Luye Medical Group subsidiary Health Care had made a bid to acquire it for $.47 cash per share, after which Pulse’s share price increased 30 per cent. The transaction was completed May 16, 2017.
The Australian Securities and Investments Commission claimed Campbell had inside information regarding the deal through his employment with Healthe Care when he applied for the 350,000 Pulse shares on October 7, 2016, and an additional 300,000 on October 14, 2016. He acquired 392,257 shares in Pulse on October 19, 2016.
Campbell was the company’s national development and construction manager at the time and a member of its executive team.
The case was prosecuted by the Commonwealth Director of Public Prosecutions.
Healthe Care Australia is Australia’s third largest corporate private hospital operator with 35 private hospitals and nearly 2,500 hospital beds, post-acquisition.
Norton Rose Fulbright served as legal adviser for Pulse on the Healthe Care transaction.
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