SANTIAGO, March 26 (Reuters) - The chairman of Chile’s biggest brokerage, LarrainVial, resigned on Wednesday, weeks after regulators launched an investigation into his possible involvement in market manipulation linked to trading in fertilizer group SQM and its holding companies.
Leonidas Vial Echeverria resigned from his post as board chairman and will be replaced by Juan Hurtado Vicuna, LarrainVial said in a brief statement without providing reasons for his departure.
Unit LarrainVial Administradora General de Fondos SA will also replace two board members “linked” to LarrainVial with independent directors, the statement said.
Chile’s securities regulator in late January formally accused some of the country’s largest brokerages of breach of regulations in an ongoing market investigation.
Among other things, the brokerages are being investigated for allegedly breaking the law that states “no person shall carry out transactions or encourage or try to encourage the purchase or sale of stocks by way of any deceitful or fraudulent act, practice, mechanism or scheme.”
LarrainVial and its executives, including Vial Echeverria and the head of the company’s brokerage, Manuel Bulnes, bore the brunt of the regulator’s accusations.
In September, the regulator accused Julio Ponce, SQM’s chairman and the former son-in-law of the late dictator Augusto Pinochet, of buying up shares below market prices and then reselling them at above-market prices.
Ponce controls SQM through his ownership in holding companies Potasios, Norte Grande, Oro Blanco and Pampa Calichera . (Reporting by Anthony Esposito; Editing by Eric Walsh)