Insider Dealing: 5 Ubisoft Employees Sentenced By The AMF To A Fine Of 1.2 Million Euros

5 employees of the French video game studio were convicted of insider trading by the AMF Sanctions Commission. The financial policeman accuses them of having sold their shares before the postponement of his Watch Dogs game, in the fall of 2013, and of having thus enriched themselves thanks to inside information. The penalties are heavy, going up to 700,000 euros.

It is an episode in which Ubisoft would have gone well, the day after Vivendi announced an increase in its stake in the capital of the video game publisher (25.15%). The Sanctions Commission of the Autorité des Marchés Financiers (AMF) wanted to strike hard: a 700,000 euros fine for Yanis Mallat, CEO of the Ubisoft studio in Montreal, 200,000 euros for Christine Burgess then Ubisoft CEO in charge of international production, 200,000 euros for Francis Baillet the vice-president “Corporate Affairs”, 100,000 euros for Olivier Paris the executive vice-president and 15,000 euros for Damien Moret the brand development director. In total, a fine of 1.215 million euros for the 5 employees. The Transatlantic bank, through which the disputed transactions had passed, is not spared either, with a sanction of 60,000 euros.

The AMF accuses the five executives of Ubisoft, which has just celebrated its 30th birthday, of having committed insider trading between September 18, 2013 and October 15 of the same year. Clearly they would have sold large volumes of shares just before the price of Ubisoft dropped sharply by more than 25% after the announcement of the postponement of two flagship AAA games from Ubisoft: Watch Dogs and The Crew after the Christmas and New Year. Thus for the financial policeman, these employees distorted the market by taking advantage of information they held to enrich themselves, to the detriment of other investors.

An “unjustified, unfounded and illegal” procedure

The sanctions pronounced for Yanis Mallat, Francis Baillet and Christine Burgess are moreover the same as those requested by the rapporteur of the AMF. Ubisoft has decided to take “note of this decision but indicates that it does not doubt the good faith of the people concerned. We are convinced that our accused employees did not intend to commit an act contrary to the regulations in force ”. The French studio defends its employees on the merits of the case by arguing that “given the modes and schedules of production of games in the video game industry and within our company, we believe that when they made their disposals our employees could not know or anticipate the subsequent decision to postpone the game in question taken by Yves Guillemot on October 11, 2013 ”. The studio remains on its position developed during its hearing before the Sanctions Commission. For Ubisoft, the decision “reflects a poor understanding of the game manufacturing process in our industry. Each game development and marketing mobilizes multiple teams within the company but only the CEO of the Group can take an exceptional decision such as postponing the release date of a game ”.

The two employees condemned to the heaviest losses (Yanis Mallat and Francis Baillet) have decided to appeal this decision. They said they were “convinced that this whole procedure is unjustified, unfounded and illegal”. These 3 employees had decided to counter-attack just before their hearing before the Sanctions Commission by launching a “petition for nullity of investigation and damages” against the AMF and also against its Quebec counterpart who participated in the procedure. . According to them, “the Commission also notes the nullity of the hearings conducted in Quebec. We will therefore continue to defend our good faith and our rights before the Court of Appeal in France but also in the context of the action brought in Quebec against AMF France and AMF Quebec ”. Even if it means passing for rabbits?