Amaya has been hit with a second wave of investigations, this time from the United States’ Financial Industries Regulation Authority into possible insider trading, according to casino.org. The Montreal based online gambling firm’s headquarters were raided in December by the Quebec version of the SEC over regulations concerning the acquisition of Pokerstars. At the time, CEO David Baazov expressed eagerness to cooperate with the investigations, confidence the merger would go through and denied any wrongdoing.
The newest investigation by FINRA comes as a surprise, and the organization is concerned by the dramatic rise in the stock price in such a short time; it is looking into the possibility of insider trading or stock manipulation. The stock nearly doubled in the two months prior to the June announcement of its $4.9 billion acquisition of Rational Group which owns Pokerstars. The stock then rose another huge amount after the deal was announced.
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The acquisition has been complex, has a lot of moving parts, and there is the belief that some of the underwriters might have leaked the deal prior to the announcement. David Baazov seems unfazed by the newest investigation and says it was something he expected, given the dramatic run-up in the stock price.