CySEC’s €6.4 Million Insider Trading Fine Overturned by Court: Report

Monday, 07/07/2025 | 20:38 GMT by Jared Kirui
  • The court found that the regulator's board was not properly constituted when it made several critical decisions in the case.
CySEC (shutterstock)

A Cypriot court has annulled more than €6.4 million in fines issued by the Cyprus Securities and Exchange Commission (CySEC) against Greek business siblings Ioannis and Amalia Vardinogiannis, CyprusMail reported.

Years-Long Insider Trading Case

The ruling ended a years-long insider trading case that collapsed due to legal flaws in CySEC's handling of the investigation. The Administrative Court accepted the appeals brought by both siblings and ruled that CySEC’s board had been improperly constituted during critical phases of the probe.

As a result, the court found that decisions taken during that time were legally void. CySEC had fined Ioannis Vardinogiannis €6,388,300 and Amalia Vardinogiannis €50,000, alleging the pair benefited from a 2007 share deal using insider information.

On March 29, 2007, Amalia acquired over 19 million shares at €0.09 each and sold them three months later for €0.42 per share, generating profits exceeding €6.3 million.

The regulator claimed Amalia acted on behalf of her brother and that the trade was made based on non-public information regarding the company’s operations in the shipping sector and changes in shareholding.

Procedural Issues by the Appellants

CySEC considered this a violation of insider trading laws. However, the court focused on procedural issues raised by the appellants. Their legal team argued that CySEC’s decisions were made by a body whose composition had already been declared invalid in unrelated rulings.

The court agreed, stating that any decisions made under the flawed composition could not stand. “In light of the above, the claim regarding the flawed constitution is accepted,” the court noted, adding that it was unnecessary to review other objections.

The court formally annulled the penalties and ordered the state to pay €1,700 plus VAT in legal costs to each of the appellants. The ruling underscores the legal risks financial regulators face when internal processes fall short, even in cases involving serious market abuse allegations.

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A Cypriot court has annulled more than €6.4 million in fines issued by the Cyprus Securities and Exchange Commission (CySEC) against Greek business siblings Ioannis and Amalia Vardinogiannis, CyprusMail reported.

Years-Long Insider Trading Case

The ruling ended a years-long insider trading case that collapsed due to legal flaws in CySEC's handling of the investigation. The Administrative Court accepted the appeals brought by both siblings and ruled that CySEC’s board had been improperly constituted during critical phases of the probe.

As a result, the court found that decisions taken during that time were legally void. CySEC had fined Ioannis Vardinogiannis €6,388,300 and Amalia Vardinogiannis €50,000, alleging the pair benefited from a 2007 share deal using insider information.

On March 29, 2007, Amalia acquired over 19 million shares at €0.09 each and sold them three months later for €0.42 per share, generating profits exceeding €6.3 million.

The regulator claimed Amalia acted on behalf of her brother and that the trade was made based on non-public information regarding the company’s operations in the shipping sector and changes in shareholding.

Procedural Issues by the Appellants

CySEC considered this a violation of insider trading laws. However, the court focused on procedural issues raised by the appellants. Their legal team argued that CySEC’s decisions were made by a body whose composition had already been declared invalid in unrelated rulings.

The court agreed, stating that any decisions made under the flawed composition could not stand. “In light of the above, the claim regarding the flawed constitution is accepted,” the court noted, adding that it was unnecessary to review other objections.

The court formally annulled the penalties and ordered the state to pay €1,700 plus VAT in legal costs to each of the appellants. The ruling underscores the legal risks financial regulators face when internal processes fall short, even in cases involving serious market abuse allegations.

You may also like: Robinhood’s Tokenized Stocks Face EU Scrutiny as OpenAI Distances Itself: Report

About the Author: Jared Kirui
Jared Kirui
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About the Author: Jared Kirui
Jared is an experienced financial journalist passionate about all things forex and CFDs.
  • 2449 Articles
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