A Victorian man has been sentenced to 11 months imprisonment and ordered to pay a penalty of more than $225,000 after pleading guilty to insider trading charges involving a $20 million capital raise by medicinal cannabis company Cann Group (ASX: CAN) in 2021.
Upon sentencing, the County Court of Victoria ordered that Dr Antonio Stella, of Donvale, be immediately released upon entering a recognisance totalling $1,000 to be of a good behaviour for a period of 12 months.
The court ruling follows a guilty plea by Stella on 1 October 2025 to two counts of insider trading while in possession of information about the Cann Group share placement before it was publicly announced in July 2021.
The medical cannabis company’s share placement raised $20 million via a placement and share purchase plan at a discount to the prevailing share price at the time of the announcement on 26 July 2021.
The shares were being offered at 27.5c each, which was a 27.6 per cent discount to the previous closing price on 21 July 2021.
The Australian Securities and Investments Commission (ASIC) alleges that, between 19 July 2021 and 20 July 2021, Stella sold 2.56 million shares in Cann Group for $954,886 while in possession of inside information about the upcoming share placement.
After Cann Group announced the share placement on 26 July 2021, Stella bought 2.09 million shares at a discounted rate through the placement.
ASIC says the move delivered Stella a $204,490 profit while avoiding a $20,986 loss following the fall in Cann Group’s shares in the wake of the placement announcement.
“If someone unfairly makes a gain from insider trading, other investors are losing,” says ASIC deputy chair Sarah Court following Stella’s sentencing.
“Financial markets can only operate fairly if information is available to all investors at the same time.
“This crime affects all Australians who invest in the share market and ASIC will continue to take strong action to combat insider trading.”
ASIC says County Court Judge Duncan Allen balanced the seriousness of the offending against mitigatory factors including Stella’s cooperation, ill health, age, exemplary character and remorse and noted that the sentence imposed was significantly lower than it would have been but for these factors.
Judge Allen also added that, but for the consent to make a pecuniary penalty order, he would have increased the sentence for Stella to 12 months for each charge and but for his early guilty plea he would have imposed 16 months for each charge.
The matter was prosecuted by the Office of the Director of Public Prosecutions after an investigation and referral by ASIC.
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