The insider trading trial of Andrew Rankin opened Monday in Ontario Court with the former managing director at RBC Dominion Securities pleading not guilty to 10 charges of insider trading and 10 counts of tipping off a childhood friend to confidential transactions RBC was working on.

There is evidence that Rankin’s longtime friend Daniel Duic bought shares in 10 companies over a year and a half — all of which were clients of RBC Dominion Securities — Kelley McKinnon, a lawyer for the Ontario Securities Commission, said in her opening remarks in Ontario Court.

Rankin worked at RBC’s mergers and acquisitions department from 1999 to mid-2001, where he would hear about potential takeovers before the public.

In some instances during that period, Duic bought hundreds of thousands of dollars’ worth of obscure stocks that turned out to be takeover targets. He sold his holdings once the deal was made public and the stock rose, McKinnon said, according to wire reports.

The trades were masked under a great deal of secrecy involving six accounts and five offshore locations, she said.

The net profit was in excess of $4 million. Duic is expected to testify that he kept most of that money, but that some of it went to Rankin, McKinnon said.

Undeclared insider trading and tipping “are considered to be some of the most serious offences under the Securities Act,” she said.

The victims include the average investor, who is not privy to such information, she said.

“But for the tipping of Mr. Rankin, all of these deals had successfully been kept confidential,”McKinnon said. “Mr. Duic traded oftentimes well in advance of the deal…at some instances, in the very early stages of the deal, when he could not possibly know” that something would happen to the stock, without a tip,

Of the 10 stocks traded, Rankin was personally working on three of the deals.

The OSC will base its case – scheduled to continue for the next six weeks – on dozens of black binders full of documents collected since 2001. They include e-mails, phone records, credit card statements and travel documents.

The OSC has records of 577 phone calls in 15 months between Duic and Rankin, McKinnon said, and hundreds of e-mails.

Duic will testify that Rankin, his friend of more than 20 years, would tell him to “load up” on a certain company, or let him know that another was “in play,” McKinnon said.

Under a settlement reached with the securities commission last year, Duic is banned for life from trading securities.

The companies he traded in included Canadian Pacific Ltd., Moffatt Communications Ltd., Canadian Satellite Communications Inc. and Irwin Toy Ltd.

Rankin was suspended without pay by RBC in April 2001, following an internal investigation. He was fired in June of that year.

He could face up to two years in jail and $1 million in fines for each count against him, plus three times the profit made from any illegal trades.

The case is being heard by Justice Ramez Khawly.