OHL Mexico Rallies After Regulator Finds No Evidence of Fraudby
CNBV considers company's accounting practices inadequate
Mexican toll-road operator fines total 71.7 million pesos
OHL Mexico SAB climbed the most in eight months after saying regulators found no evidence of fraud at the toll-road operator, which has been dogged by allegations it paid off judges and picked up luxury hotel tabs for public officials.
Regulators who probed OHL still penalized the company for its accounting practices and alleged it didn’t properly inform investors about traffic levels on its highways, results which contradict a company-commissioned audit that found the accounting practices were appropriate. The inquiry was triggered in 2014 when market participants wrote letters to regulators questioning OHL’s accounting and after media reports about the company, Bloomberg News reported last year.
The CNBV fined the company 24.6 million pesos ($1.4 million), while its subsidiaries and executives were also fined. Penalties total 71.7 million pesos, the company said.
“The fine is pretty small,” said Gerardo Cevallos an analyst at Vector Casa de Bolsa over the phone. The lack of evidence of fraud “is being interpreted as positive news."
Separate federal and state investigations are still pending after recordings emerged on YouTube last year purporting to show executives discussing ways to inflate toll rates, bribe judges and pay for a state official’s Christmas-week stay at a swanky Caribbean beach hotel. OHL Mexico has denied any wrongdoing.