08/01/2014 10:51 EDT | Updated 10/01/2014 05:59 EDT

Prem Watsa, Fairfax probed by Quebec in insider trading investigation

Fairfax Financial Holdings Ltd. and its CEO, Prem Watsa, are co-operating with an investigation by Quebec's financial regulator into insider trading and tipping activity during an unnamed transaction.

In its quarterly earnings report late Thursday, Fairfax disclosed  that Quebec's Autorité des marchés financiers is looking into the company.

"The investigation concerns the possibility of illegal insider trading and/or tipping (not involving any personal trading by the individuals) in connection with a Quebec transaction," Fairfax said.

Insider trading is when individuals or companies with advanced knowledge of pending news trade based on that information to make money. Tipping is when a person with that advanced knowledge shares it with someone else so they can trade on it.

Watsa is one of Canada's most well-known activist investors, who has a good track record of investing in beaten down companies and helping to turn them around. Watsa and Fairfax played a prominent role in an attempt to buy BlackBerry last year.

"We are fully cooperating with the authorities and we are required strict confidentiality during the investigation," Watsa said on a conference call discussing the results early Friday "... I can say there is no personal trading involved and we are confident that we did nothing wrong."