AP1 hit by new rules breach as head of equities agrees to quit

The equities chief of Swedish national pensions buffer fund AP1 has had to leave the organisation amid a dispute sparked by a breach of the fund’s internal rules over personal investments – just months after the fund’s chief executive was fired in similar circumstances. 

In two separate cases Olof Jonasson, the SEK352bn (€33.5bn) pension fund’s head of equities, bought shares in companies AP1 later invested in, a spokeswoman for the fund confirmed.

Both of the cases applied to fund investments made in 2019.

In the first case, Jonasson’s private investment was made two to three months before the pension fund’s investment, and in the second case, the personal transaction and the AP1 investment were separated by nine months, the spokeswoman said.

In a third case, she told IPE, the head of equities bought shares privately and through the pension fund in the same company during the early weeks of 2019.

“The compliance assessment is that it is a violation of the conflict of interest policy not to flag the case to the manager and to ensure the conflict is handled,” she said.

However, AP1 believed the case against Jonasson would become difficult legally, she said, because his superior did not warn him of the consequences when complaining about Jonasson reporting his private investments too late.

So instead of taking the legal route, AP1 reached an agreement with Jonasson and he left the fund, she said.

“We have zero-tolerance in this area, non-compliance with the internal regulatory framework should have appropriate consequences,” the spokeswoman said.

“It is of utmost importance that the fund’s board and employees act in a way that the trust in AP1, and in the overall Sweden’s national income pension system, is retained,” she said.

The departure of Jonasson comes just three months after the pension fund’s chief executive Johan Magnusson was sacked for buying shares in the initial public offering of Swedish property company John Mattson Fastighetsföretag, which he had already decided AP1 would participate in as an anchor investor.