SANTIAGO, Sept 9 (Reuters) - Chilean pension fund Provida AFP said on Tuesday it will sue Julio Ponce, chairman of fertilizer company SQM, and LarrainVial, the country’s largest brokerage, for their involvement in a market trading scandal linked to SQM.
Provida, the powerful pension fund administrator controlled by MetLife, said it will seek legal actions against the people and companies that were fined by Chile’s SVS securities regulator for a scheme of buying up shares at below-market prices and then reselling them at above-market prices.
Ponce, who is the former son-in-law of ex-dictator Augusto Pinchet, was fined nearly $70 million by the market regulator, the biggest individual fine out of a total $164 million levied in the market manipulation scandal. The SVS fined another seven individuals and LarrainVial.
Often considered one of Latin America’s least corrupt economies, Chile has been roiled in recent months by the affair involving the holding, or “cascada,” companies linked to SQM , which owns vast nitrate and lithium resources in the Atacama desert.
“A key part of our responsibility as a pension fund administrator is to protect our clients’ legitimate interests in the face of possible market irregularities that could be detrimental to them,” Provida’s chief executive, Ricardo Rodriguez, said.
“The purpose of these legal actions is to seek the reparation of damages the pension funds might have suffered,” he added.
Ponce controls SQM through his ownership in holding companies Potasios, Norte Grande, Oro Blanco and Pampa Calichera.
Provida said it did not rule out legal actions against other parties that “could be involved in the operations.” (Reporting by Felipe Iturrieta; Writing by Anthony Esposito; Editing by Leslie Adler)