Bundy settles court action
(2 May 2011 – Australia) Investment banker Greg Bundy settled court action with Goldman Sachs JBWere, agreeing to pay A$2.2 million to his stockbroker.
Mr Bundy, former boss of Merril Lynch Australia launched action in Federal Court in 2008, alleging Goldman engaged in misleading and deceptive conduct.
The conduct was over an agreement that Mr Bundy would buy shares at preset prices, which court documents show as trading agreements Goldman had marketed as "Buy Below Market" transactions, which Mr Bundy defaulted on.
Mr Bundy claimed his broker told him he could ''break the trade'' to cut his losses but that when he tried to do so in 2008 he discovered his losses would jump.
He had claimed he would have been required to spend A$29.8 million on stocks between September 2007 and November 2008. When he incurred a loss of more than A$900,000 and failed to make agreed payments, Goldman demanded more than A$5.7 million in compensation for terminating the trades.
Mr Bundy had sought a court order to declare the agreement with his broker unenforceable. Goldman had launched a cross claim of its own, demanding payment of the A$5.7 million.
The trial was set for June, but has been settled out of court.
The conduct was over an agreement that Mr Bundy would buy shares at preset prices, which court documents show as trading agreements Goldman had marketed as "Buy Below Market" transactions, which Mr Bundy defaulted on.
Mr Bundy claimed his broker told him he could ''break the trade'' to cut his losses but that when he tried to do so in 2008 he discovered his losses would jump.
He had claimed he would have been required to spend A$29.8 million on stocks between September 2007 and November 2008. When he incurred a loss of more than A$900,000 and failed to make agreed payments, Goldman demanded more than A$5.7 million in compensation for terminating the trades.
Mr Bundy had sought a court order to declare the agreement with his broker unenforceable. Goldman had launched a cross claim of its own, demanding payment of the A$5.7 million.
The trial was set for June, but has been settled out of court.
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