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Amaya CEO David Baazov attends the company's annual general meeting in Montreal, in a June 22, 2015, file photo.Graham Hughes/The Canadian Press

Former Amaya Inc. chief executive officer David Baazov maintains that he's innocent on charges of illegal insider trading following the admission by an investigator for Quebec's securities watchdog that it has no direct proof of privileged information being shared over the phone about several corporate takeovers.

Xavier Saint-Pierre, an investigator for the Autorité des marchés financiers, said under cross-examination by Mr. Baazov's lawyer Wednesday that there is only circumstantial evidence suggesting Mr. Baazov passed on information related to three of seven corporate deals being probed by the regulator and which he was asked about. Sophie Melchers of Norton Rose Fulbright, counsel for the Montreal entrepreneur, was granted permission to ask questions as part of a hearing before an independent administrative tribunal weighing the merit of cease-trade orders for individuals in the case.

"Today was the first step in setting the record straight," Mr. Baazov said in a statement provided by spokesman Ian Robertson. "I would like to reiterate that I did not receive any money, gifts or anything for that matter as it relates to the trading by any of these people in any securities. I look forward to being exonerated and putting this behind me."

Read more: Amaya: The largest insider trading investigation in Canadian history

The cross-examination before the tribunal marked the first time a lawyer for Mr. Baazov has been able to test any of the evidence the AMF has in a separate criminal case against him. It underscores the difficulty prosecutors could face in obtaining a conviction in Canada's largest ever insider trading probe without evidence that amounts to a smoking gun.

The AMF alleges that Mr. Baazov was part of a tight-knit group of people who collectively made about $1.5-million on stock trades from tips he provided about several takeover deals stretching back to 2010, including Amaya's purchase of Cryptologic Ltd. and Chartwell Technology Inc., as well as Scientific Games Corp.'s takeover of WMS Industries Inc. The regulator says he passed on information about certain deals to his brother, Josh Baazov, and to another Montreal businessman, Craig Levett, who then passed it on to others.

Kickbacks equalling 10 per cent of net gains were paid by those lower in the pyramid to those higher up, the watchdog says.

The information the regulator is using to make its allegations include phone records between the individuals' cellphones, as well as text messages, e-mails and trading records. But investigators don't know what was said on those phone calls, Mr. Saint-Pierre said. In some cases, the calls were so short it was not clear whether the individuals even spoke, he said.

There are other gaps in the evidence the AMF has presented so far.

For example, the AMF says it found an e-mail from Mr. Levett to Josh Baazov the day before the WMS deal was announced stating: "Josh, I can't reach your brother. Any news on the stock. The news was supposed to come out." But there is no direct correspondence showing that David Baazov passed on information on that transaction.

Mr. Saint-Pierre also stated that the regulator was not able to seize Mr. Baazov's cellphone on the day it raided Amaya's headquarters in Montreal in 2014, and that his team realized later the CEO had swapped it for a new one. It was not immediately clear why it was unable to obtain the device.

Ms. Melchers exposed what she called omissions and flaws in some of the evidence the AMF presented to the tribunal as part of the regulator's cease-trade application, suggesting the AMF was using selective information to make its case.

The freeze-trade hearing resumes Oct. 4 with Ms. Melchers' continued cross examination of Mr. Saint-Pierre. Josh Baazov's lawyers are also expected to question the investigator at that time.

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