UPDATE 1- Hedge fund Japan Advisory gets hearing for insider trading charge - regulator

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TOKYO, Oct 10 (Reuters) - Japan Advisory will have theopportunity to challenge insider trading charges against theTokyo-based hedge fund at a hearing on Oct. 17, the country'sfinancial regulator said on its website on Wednesday.

The case against Japan Advisory was one of five announcedthis year by the securities watchdog, the Securities Exchangeand Surveillance Commission (SESC), in a high-profile crackdownon insider trading ahead of public share offerings, a nearendemic problem that had gone unchecked in Japan for years.

Japan Advisory was fined and had its license revoked in Juneafter regulators found it had shorted shares in Nippon SheetGlass Co in August 2010 using leaked information thatthe glassmaker was planning a share offering.

The hedge fund filed a written objection to the charges,prompting the Financial Services Agency (FSA) to schedule ahearing in accordance with normal procedure in such cases. Thehearing will be overseen by the FSA.

Japan Advisory officials could not be reached for comment.

The SESC determined that a former employee of DaiwaSecurities Group , which was a lead underwriter on theNippon Sheet Glass offering, was the source of the leak.

After the case against Japan Advisory was announced, the FSAordered all major brokers operating in Tokyo to report on theirdealings with the hedge fund, believing it had been payingoutsized commissions in return for inside tips on deals.

(Reporting by Nathan Layne and Noriyuki Hirata; Editing byChris Gallagher and Matt Driskill)



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