I sent a email to Lou Schizas host of Happy CapitaThis is the Q and A regarding the IIROC decision.....Lou is a regular on AM640 here in Toronto.
GLTA
----- Original Message -----
Sent: Wednesday, August 06, 2008 4:23 PM
Subject: The Energulf story.
Hey Lou, Big fan.
I have a story for you which is IMO a dark side of capitalism.
I am invested in Energulf Resources ENG-TSXV and today at 9:26 AM they released the following NR regarding their current DV off the coast of Namibia:
https://www.marketwire.com/press-release/Energulf-Resources-Inc-TSX-VENTURE-ENG-886588.html
I like to stay on top of my investments so I am always scanning for news releases between 8AM to the open. So when I heard the bad news I sold my position at 1.40.
Between 930 and 10AM the stock nose dived to 60cents with under a million shares traded.
I considered myself lucky that my Vigilance saved me a sizable chuck of change.
A little after 10AM investors were informed that ENG has been halted and the IIROC have decided to cancel all of today's trades due to the fact that the NR "wasn't released properly" and now have to wait until the stock reopens to sell.
Unfortunately the LV2 looks like it will open around 55 cents (below the 52 week low).
This process of cancelling the trades by the IIROC is entirely new to me and I would appreciate if you could enlighten myself and any of your listeners if they would be interested, and if you have seen this before with other companies and what was the outcome?
Also is a sell order a legal binding contact if its filled?
and if there is any legal action I can take against the company?
Thanks Lou.
Kirk "Jackknife" Janssen.
Answer I recieved:
Hi Kirk - well ENG had quite the run - I covered ENG in January and it looked like an all or nothing play -
As far as the Investment Industry Regulatory Organization of Canada ( IIROC ) decision - I'm not sure where you picked up the news but it seems the regulator had trouble with distribution of the news - it has to seem to go to all investors at the same time - its a pretty easy procedure to follow and satisfy. It is not uncommon for the regulator to call a company offside on procedural matters. You would have to conduct a cost benefit analysis of court action - generally the deepest pockets win - which would be the insurance compnay that covers the company for errors and ommissions -- maybe a class action?
Sorry for your loss - never fun - but part of the action - when you find out how ENG messed up the distribution I would be interested - happy capitalism!