Jean-Paul Gut, a former general manager of European aerospace giant EADS, is in French police custody. Gut is among those executives suspected of selling shares prior to the announcement of trouble at the Airbus branch.
The former general manager of European aerospace giant EADS, Jean-Paul Gut, has been detained for questioning on allegations of insider trading, sources close to the matter said on Tuesday.
They said Gut, who had been taken into custody by the French financial crime unit on Monday, was to be held for a further 24 hours from Tuesday morning. He left the company in June 2007.
Gut is among current and former EADS executives who, according to legal sources, are liable to face questioning in the sale of EADS shares prior to a June 2006 announcement by EADS unit Airbus of major delays to its A380 superjumbo programme.
That revelation sparked a crisis at EADS, the European Aeronautic Defence and Space Company, and sent its share price tumbling.
A report by the French financial market regulator, the AMF, alleged that Gut had sold stock options in EADS worth 1.7 million euros (2.6 million dollars) in November 2005 and March 2006 when he could have had privileged information on problems with the A380 and another project, the A350.
The AMF report targeted 16 other current and former EADS and Airbus executives, including former EADS co-chairman Noel Forgeard.
On May 20, Forgeard, who has denied wrongdoing, was put under formal investigation, a step close to being charged, over alleged insider trading.
On Tuesday, lawyers representing Gut said in a statement: "Jean-Paul Gut took the initiative to ask to be questioned as quickly as possible by the investigating magistrates ... in order to avoid biased analyses and deliberately slanted presentations of the facts, which have been the subject of malicious leaks."
Following his detention, Gut could be brought before two judges handling the EADS case, Xaviere Simeoni and Cecile Pendaries, after which he could be placed under formal investigation or designated as an assisted witness, meaning that he could eventually be placed under investigation.
Gut's lawyers added on Tuesday that Gut, formerly responsible for marketing, strategy and international affairs at EADS, "can thus explain his case calmly and will be able to show that he was in possession of no privileged information when he decided to exercise his stock options."
They said the stock option operation had been carried out "strictly respecting internal rules and regulations at EADS and on authorised dates."
Date created : 2008-06-17