May 9 (Bloomberg) -- A National Australia Bank Ltd. trader and an employee of the nation’s statistics bureau have been arrested and charged, accused of colluding to illegally profit from insider trading on government economic data.
The pair allegedly made profits of about A$7 million ($6.6 million), Australian Federal Police Acting National Manager of Crime Operations Ian McCartney told reporters in Canberra. The offense occurred between August last year and May this year, he said. The NAB employee was acting independently from the bank, the official said. NAB said the employee has been fired.
A 26-year-old Melbourne man faces charges of insider trading and corruption of a public official, the AFP said. The 24-year-old Australian Bureau of Statistics employee has been charged with insider trading, receiving a corrupt benefit, release of sensitive information and abuse of public office.
“Investigations like this send a clear message to anyone who is thinking of engaging in this type of criminal activity - we have the ability to monitor you and take action, as we’ve done today,” McCartney said in a statement.
The trader used foreign exchange derivatives to gain leveraged exposure to price movements in the foreign exchange market in order to profit from the inside information, said Chris Savundra, head of markets enforcement at the Australian Securities and Investments Commission.
“No NAB systems or money or customer money was used by the 26-year-old trader,” NAB’s Melbourne-based spokesman Brian Walsh said by phone. “These were all personal trades.”
The ABS said the arrested staff member is “a relatively junior officer with trusted access to a number of economic collections both pre- and post-publication.”
It is alleged the ABS employee “disclosed sensitive statistics that were under embargo,” the ABS said in a statement posted on its website. The officer has been suspended. No other ABS staff are suspected of involvement and a review will be undertaken, it said.
In May 2012, an ABS employee sent to Citigroup Inc. and Commonwealth Bank of Australia retail sales data about 18 minutes before it was released to the general public because of a mix-up. The ABS compiles and distributes the nation’s key economic data including gross domestic product and inflation.
“NAB has a strict code of conduct that all employees must adhere to as part of their employment and if NAB is aware that any employee has acted contrary to its code of conduct, we will take appropriate action,” Chief Executive Officer of the Melbourne-based lender Cameron Clyne said in a statement.
NAB shares closed 0.7 percent higher at A$34.38 in Sydney. The benchmark S&P/ASX 200 index dropped 0.3 percent.
To contact the editors responsible for this story: Rosalind Mathieson at email@example.com Iain McDonald