Alert regarding notification of dealings by directors and persons discharging managerial responsibilities
We are warning issuers not to disclose more information than necessary where directors and persons discharging managerial responsibilities (PDMR) hold nominee accounts, to protect themselves from fraud.
The police have alerted us to several recent incidents where fraudsters have assumed the identities of listed company directors and sold shares in their name.
According to the police, fraudsters can gather information about a director from several publicly available sources. These sources include the information on nominee accounts contained in announcements required by the Disclosure Rules, Annex 3 i.e. the 'Notification of dealings by directors/ persons discharging managerial responsibilities' (the PDMR form).
Fraudsters can use extra information about the nominee account where the director or PDMR holds shares. Fraudsters have been known to telephone the nominee holder, pretending to be the individual named on the form. They use extra information found on the PDMR form and other publicly available information to answer questions and ask the nominee holder to sell the shares and transfer the money to another account (the fraudster's account).
The PDMR form requires the name of the registered shareholder(s) to be included. We recommend that issuers should not include the full nominee account details or any other information that is not required when completing this form.
For example, the nominee account holder should be 'Barclays Capital' rather than 'Barclays Capital account number AB – 12345'.
The information that issuers include in a PDMR form is just one part of a chain of information that a fraudster may use, but by omitting this information, we hope that the number of incidents of fraud will be reduced.