Warner Music Group Corp. chairman and CEO Edgar Bronfman Jr. is facing preliminary charges of insider trading during his days at French media conglomerate Vivendi Universal, the Associated Press reported.
Under French law, preliminary charges are filed when an investigating judge has determined there is strong evidence to suggest involvement in a crime, the AP explained. The filing gives the magistrate more time to pursue an investigation.
Bronfman, who resigned as executive vice chairman of Vivendi in 2002 but stayed on as a consultant, is suspected of insider trading in connection with a sale of Vivendi shares in January 2000, according to the AP report, citing sources who agreed to speak on condition of anonymity.
Bronfman’s lawyer, Thierry Marembert, denied the alleged wrongdoing. “Mr. Bronfman’s transactions have at all times been proper and at no time did he contravene any French laws or regulations,” Marembert said in a statement.
Several other former Vivendi executives, including former chairman Jean-Marie Messier, also face preliminary charges in the probe.
In 2002 shareholders filed a complaint alleging the company deliberately misled investors into buying or holding Vivendi’s stock. The AP said investigators are trying to determine whether the company published false balance sheets for the fiscal years 2000 and 2001 and issued deceptive information about its forecasts.