Waugh sentenced over Genesis insider trading

Cam Waugh will serve nine months in prison after being convicted of insider trading in Genesis Minerals shares, having prior knowledge of the company's $20.8 million funding package and board appointments.

Mr Waugh previously pleaded guilty to one charge of acquiring more than 747,000 Genesis Mineral shares while in possession of inside information, in Stirling Gardens Magistrates Court.

Appearing before Supreme Court Justice Amanda Forrester today, Mr Waugh spoke to confirm his guilty plea but shed some tears while sitting in the court dock.

Justice Forrester sentenced Mr Waugh to two years imprisonment but he would be released after nine months with the remaining 15 months on recognisance.

“I’m satisfied that he’s very contrite,” Justice Forrester said in court.

“He always knew what he’s done. He knew that the Crown's case was very strong.”

The Australian Securities and Investments Commission launched an investigation into Mr Waugh after suspecting he traded shares with insider knowledge he gained while working at Nev Power and Nick Power's company Omnia.

ASIC's investigation led to the Cottesloe analyst being charged with six offences related to insider trading in December 2022.

In January, the Commonwealth Director of Public Prosecutions dismissed five charges.

The court was told Mr Waugh knew about an upcoming funding proposal and the restructure of the Genesis board that included Raleigh Finlayson and Nev Power when he made his share applications on six occassions over five days, before the company announced it on the market in September 2021.

Barrister Christopher Shananan, on behalf of the Commonwealth, told the court Nick Power approached Mr Waugh to work at Omnia company after the pair worked on a project together.

Mr Power and his son, Nicholas Power, are listed as directors of Omnia Company, according to an ASIC document.

It was at Omnia that Mr Waugh was given access to confidential information about Genesis Minerals and the upcoming $20.8 million funding package, and the board appointments, lawyers told the court.

Mr Waugh spent $55,250 to acquire the more than 747,000 Genesis Minerals shares, which he later sold for more than $112,500 to make a profit of $57,256.

In court, Justice Forrester said Genesis Minerals' shares were trading up 187 per cent after the funding package announcement was made.

In the ASX announcement, Mr Finlayson was named as the company's incoming managing director and Nev Power was appointed to the Genesis board.

Business News does not suggest that Mr Finlayson, Mr Power or his son had any involvement with the charges against Mr Waugh.

The court was told Mr Waugh’s employment at Omnia was terminated when the Powers knew of his shares application in Genesis Minerals.

Mr Waugh will also be disqualified from managing corporations for five years, and will pay a precuniary penalty of $57,000 three months after his release.

"I bear in mind the natural consequence is that a directorial position is unlikely to be in your future for some time," Justice Forrester said in court.

Mr Waugh will be released on Christmas Day.

Personal history

Speaking to the court, Mr Waugh’s lawyer Seamus Rafferty said his client acted out of character and has suffered from generalised anxiety that stemmed from childhood trauma.

He said Mr Waugh regretted his actions, and admitted his desperation outweighed his moral compass.

“This was a man …who has been made aware of numerous confidential information, but he has never acted upon it,” Mr Rafferty said.

Mr Rafferty said Mr Waugh did not want to disappoint the Powers, who had the father-son relationship and the balance of work and personal lifestyle he desired, and bought more shares than he was allocated to in the funding package.

“This is something he wanted to emulate,” Mr Rafferty told the court.

“That self-image he had of himself is such if he doesn’t fulfil his end of the bargain, he’ll ultimately let them down.

“That’s exactly how my client felt in this scenario at the time of offending. He’s never done this before.”

Speaking to the court, Justice Forrester acknowledged Mr Waugh's anxiety disorder but said he was a competent professional prior to the offending.

"You met the Powers in 2019 through your work in Melbourne. You spent more time with Nick Power from February 2021," Justice Forrester said.

"[This] introduced you to a significantly more affluent lifestyle that your own, and a positive father-son relationship and you were envious of both.

"Your offending was very serious, you had full knowledge of what you were doing.

"You were one of the few who had access to this information and was well aware of its importance and profitable returns.

"Your conduct was also persistent, being six occassions over four different days. You had time and opportunity to reflect and ponder but continued anyway."

Mr Waugh was an investment analyst at Wyloo Metals and was previously part of KPMG M&A's metals and mining team.