Japan Advisory did not show up for a hearing on Wednesday called to allow the Tokyo-based hedge fund to contest charges of insider trading, increasing the likelihood the securities regulator's case against it will be upheld.

Japan Advisory was fined and had its license revoked in June after the Securities Exchange and Surveillance Commission (SESC) found it had shorted shares in Nippon Sheet Glass in August 2010 based on an inside tip the glassmaker was planning to issue new stock.

The case against the high-profile hedge fund was one of five announced this year by the SESC in an industry-wide crackdown on insider trading by investors who were getting tipped off by their brokers about public share offerings.

The hedge fund had submitted a written objection to the SESC's findings, prompting the Financial Services Agency, the financial industry regulator that oversees the SESC, to grant it a hearing in accordance with regular procedures.

A team of SESC prosecutors was in attendance and answered a few basic questions from the panel of three judges about their evidence in the case. The hearing, held in the same government building housing the FSA and SESC, was over in 25 minutes.

By failing to attend the hearing, Japan Advisory has waived its right to present evidence in its defense. But the panel did not render a judgment, saying they would deliberate the merits of the SESC's case and deliver a ruling at a later date.