Monetary fine for LHV Asset Management for filing false data in reports on investments
The Financial Supervision Authority has levied an 11,000-euro fine on AS LHV Varahaldus (LHV Asset Management), as the fund administrator violated provisions of the Investment Funds Act under which information published on funds may not be false.
In the first half of this year, AS LHV Varahaldus released false information in its investment reports on LHV Pensionifond L and LHV Pensionifond XL and forwarded them to the Financial Supervision Authority. Namely, the average buying price of the LHV Persian Gulf Fund B-unit in the LHV Pension Fund L portfolio was noted as 0.25 euros in the report, instead of the actual 3.84 euros. The average buying price of the LHV Persian Gulf Fund B-unit in the LHV Pension Fund XL portfolio was noted as 0.27 euros in the report, instead of the actual 4.23 euros.
The basis for the financial oversight proceedings was an article by Sulev Vedler published in Eesti Ekspress on 5 July 2012 entitled “Kuhu, kurat, nad meie pensioniraha panid?” (Where the hell did they put our retirement money?). According to the article, the value of the LHV Persian Gulf Fund B-unit in the AS LHV Asset Management had grown 19-fold since the investment was made, leaving the impression that the B-units were a very successful investment. The actual growth was much less, the conclusion regarding greater growth was based on the inaccurate information published.