18 August 2005
Germany probes Daimler for insider trading
- By AP
Duesseldorf, Aug. 17: Regulators said on Wednesday they had opened a formal investigation into possible insider trading in shares of DaimlerChrysler AG after finding "grounds" to suspect illegal dealing in the automaker’s stock.
Germany’s financial-services watchdog, BaFin, ran a routine check after DaimlerChrysler’s stock jumped just before last month’s announcement that chief executive Juergen Schrempp would resign.
BaFin spokeswoman Sabine Reimer said the regulator had opened a formal investigation after the routine probe found "grounds for possible illegal trades" just before the announcement, but the probe had yet to identify particular suspects.
"We are asking all financial institutions to show us who bought or sold shares. Then we will try to find links to people who knew of Schrempp’s extensive plans," Ms Reimer pointed out.
The investigation would likely take several weeks, she said.
DaimlerChrysler spokesman Toni Melfi declined to comment.
Stock in the German-United States automaker opened around 36.50 euros on July 28, but began rising on reports that Mr Schrempp was about to step down.
By the time an official announcement was made after 10.30 a.m. (local time), it was at about 39.35 euros a gain of nearly 8 per cent — and closed the day more than 10 per cent higher.
The company named Dieter Zetsche, 52, who led the resurgence of the company’s United States Chrysler Group, to replace Mr Schrempp at the head of the world’s fifth-largest carmaker at the beginning of next year.
On Wednesday, DaimlerChrysler shares fell 1 per cent to 40.88 euros ($50.52) in early Frankfurt trading.