Posts Tagged ‘fsa’

FSA fines two more over Greenlight insider trading after David Einhorn / Siim

03/02/2012. Tags: , , , , , , , , | This post has no Comments

The Telegraph writes that two more individuals connected to US hedge fund Greenlight Capital have been fined over a multi-million pound insider-dealing case.

The City regulator fined Alexander Ten-Holter, Greenlight’s compliance officer, £130,000 and JP Morgan trader Caspar Agnew £65,000.

Both individuals were censured for failing to either identify or ask questions about Greenlight’s trading in Punch Taverns. The hedge fund sold significant tranches of Punch shares knowing the company was about to raise money, a move almost certain to drive Punch’s shares down.

Despite being told by a Greenlight analyst that the hedge fund had just spoken to Punch management and knew “secret bad things”, Mr Ten-Holter “took no steps to satisfy himself that the order was not based on inside information,” according to the FSA.

The regulator said Mr Agnew also became aware that Greenlight may have been trading on inside information but failed to act. Mr Agnew said he thought Greenlight was just “fortunate” in its timing.

Greenlight founder David Einhorn was fined £7.2m together with his fund for insider dealing. The fine’s size and action against the compliance officer shows a ramping up of FSA enforcement.

Read whole story …

Square Mile rocked by “insider” swoops and arrests / Martin

30/03/2010. Tags: , , , , , , , , , , , | This post has no Comments

Times Online writes that The Serious Organised Crime Agency raids on some of banking’s big names have sent shock waves through the City of London.

/…/

The men are suspected of being part of what the watchdog has described as a “sophisticated and long-running insider dealing ring”. The FSA believes the ring made “significant profits” by trading on secret information.

This was the fifth set of arrests since it launched a crackdown two years ago, though this is markedly different from the others. Previous efforts have homed in on fringe players — interns at investment banks, retired stockbrokers, silver surfers with online trading accounts, and occasional rogues at second-tier firms.

Last week’s arrests struck at the heart of the City. Dodgson, 38, is known by the bosses of almost all Britain’s big banks and insurers. He has been a trusted adviser on deals for the likes of HBOS and Legal & General. He even played a bit-part in advising the Treasury on the banking bailout. His CV reads like a roll-call of the City’s biggest investment banks: Cazenove, UBS, Morgan Stanley, Lehman Brothers and Deutsche.

The same is true of the other suspects. Clive Roberts, who was also questioned on Tuesday morning, is head of equities at Exane BNP Paribas. His clients include some of London’s biggest traders, such as Roger Guy, star fund manager at Gartmore.

Julian Rifat, 41, whose Oxfordshire home was raided at 4.45am on Tuesday, is a trader with Moore Capital. Every device in his home that could store information was removed by investigators — including his children’s iPods.

Other suspects include well-known brokers and traders in the AIM market, regularly spotted out and about in City wine bars.

If the FSA can prove its case, it will shake the City to its core.

“I’m absolutely disgusted,” said one senior City banker. “The idea that someone in our line of work could do anything with inside information appals me. We get inside information all the time — it’s part of the job. You assume that everyone respects that. It’s what we do. You simply could not function if you were to spend all your time thinking that members of your team may be trading on that information.”

In the City’s biggest banks, it is assumed that insider dealing is something that happens somewhere else. There are armies of compliance staff monitoring every trade.

Read the whole story >>

Two City workers face fine and ban after insider trading / Martin

13/01/2010. Tags: , , , , , | This post has no Comments

The Guardian wrote that two City workers face fines and a ban from the Square Mile after they used inside information to make more than £85,000 from spread betting on shares.

Robin Chhabra, a former research analyst at Evolution, and his friend Sameer Patel, an investment manager at General Motors Asset Management, were found by a City tribunal to have colluded in using confidential information to make quick profits.

Their punishment is yet to be decided because they had been disputing a finding by the Financial Services Authority that they had committed market abuse. However, the financial services and markets tribunal, which rules on disputes between the FSA and individuals and firms facing regulatory action, upheld the FSA’s case.

Margaret Cole, FSA director of enforcement and financial crime, said: “Chhabra and Patel’s behaviour fell far short of that expected of approved persons. By repeatedly giving Patel privileged information, Chhabra breached the trust of his clients and his employer.

“Patel exploited this information to try to make a quick profit at the expense of other investors. Market abuse is a serious matter and the FSA will continue to pursue and take action against anyone who believes they can make easy money off the back of confidential information.”

The tribunal will hold a new hearing on the “penalties and prohibition orders” against the two men, both aged 38. They have known each other for more than 20 years, acting as each other’s best man, and between 20 April and 3 August 2004 had 165 “telephone contacts”.

Patel, who was using his own money to trade, made £85,541 after placing spread bets on ebookers and Eidos shares following tips from Chhabra, who received inside information at Evolution where he covered 20 stocks.

Some of the gains were made when the companies issued profits warnings during the middle of the trading day – an unusual occurrence, rather than 7am – the tribunal was told by the FSA.

Read the whole story >>

FSA fines former stockbroker £24,000 for insider dealing / Martin

19/11/2009. Tags: , , , , , | This post has no Comments

IFA Online wrote about Alexei Krilov-Harrison released inside information of a major contract between Provexis and an international food company to his clients two days before the formal announcement, when the company’s share price was forecast to rise as a result.

On 28 March 2007, Krilov-Harrison made three calls to clients disclosing the upcoming Provexis deal, advising the share price would ‘jump up substantially’ when made public and encouraging them to buy Provexis shares.

Two days later, Provexis announced the new contract and its share price increased by 19.81% from the closing price on the previous day. The FSA found Krilov-Harrison’s actions had been deliberate and been motivated by his desire to get a bonus.

Margaret Cole, director of enforcement and financial crime at the FSA, says: “Anyone who uses inside information to encourage their clients to buy shares is abusing their privileged position and cheating other honest investors. This is plainly wrong. Market participants must ensure they do not pass inside information to their clients in these circumstances.

“We are committed to tackling market abuse in its various guises and will not hesitate to take action to ensure that the UK markets operate in a fair, efficient and orderly way for all investors.”

Estonian businessman Tool faces court over Arco Vara bourse manipulation / Siim

17/11/2009. Tags: , , , , , , | This post has no Comments

The Baltic Cource wrote that the North Estonian District Prosecutor’s Office sent to court a criminal case accusing a prominent Estonian businessman Toomas Tool and former SEB bank broker Karoly Kirber of manipulating the securities market, namely the share price of real estate company Arco Vara.

Tool is being accused of, while being an authorised representative of his wife, giving selling orders of a large amount of shares at a SEB account connected to his wife, to SEB bank broker Karoly Kirber on July 14-21, 2008. The order specified selling the shares at a price that became gradually lower. The aim of that was to bring the market price of Arco Vara share below 0.56 euro, which enabled Tool to influence other large owners of Arco Vara in making decisions.

Ex-SEB Enskilda Analyst Charged in Insider Case / Martin

07/11/2009. Tags: , , , , , , , , , , , , | This post has no Comments

New York Times wrote that Estonian prosecutors charged Dmitri Vassiljev, a former analyst at SEB Enskilda, with using inside information to trade shares and options of the Baltic telecommunications companiess Eesti Telekom and TEO.

Mr. Vassiljev used information on TeliaSonera’s offer to buy out minority shareholders in the two companies to which he had access to before it was made public, the Tallinn-based state prosecutor’s office and Financial Supervisory Authority said Thursday in separate statements. Eesti Telekom rose 23 percent and TEO jumped 30 percent after the offer was announced
August 24th.

Ahto Kink
[18.01.2010 19:16:49 | Edited 19:17:20] Ahto Kink: This case highlights the importance of proper systems and controls that investment banks and advisors should have in place in order safeguard inside information from their customers.
In particular:
- every member of the staff should be exposed to the information only on a need to know basis;
- flow of inside information should be rigorously controlled and list of insiders, with exact date and time when information was received, maintained;
- each employee who has obtained the access to the information, should be alerted about the fact that the information received, is inside information;
- adequate personal account dealing controls (e.g. list of restricted instruments) should prohibit members of the staff from making transactions (directly or via related persons) with securities issued by the customer.


Comments from CSA Partners:

This case highlights the importance of proper systems and controls that investment banks and advisors should have in place in order safeguard inside information from their customers.

In particular:

  • every member of the staff should be exposed to the information only on a need to know basis;
  • flow of inside information should be rigorously controlled and list of insiders, with exact date and time when information was received, maintained;
  • each employee who has obtained the access to the information, should be alerted about the fact that the information received, is inside information;
  • adequate personal account dealing controls (e.g. list of restricted instruments) should prohibit members of the staff from making transactions (directly or via related persons) with securities issued by the customer.

FSA secures first jail term for insider dealing / Mait

31/03/2009. Tags: , , , , | This post has no Comments

Times Online writes about a solicitor who tipped off his father-in-law and profited from a takeover deal was jailed for eight months today in the Financial Services Authority’s (FSA) first criminal prosecution for insider dealing. Christopher McQuoid, 40, committed the offence while acting in his professional capacity and in a position of trust, said Judge Peter Testar, passing sentence at London’s Southwark Crown Court.

His father-in-law, James Melbourne, 75, was given the same sentence, but suspended for 12 months, partly because of his age. The lawyer, from Royston, Hertfordshire, and his father-in-law, of, Ripley, Derbyshire, were found guilty of one count of insider trading on Friday.

During a two week trial the court heard that the pair shared a £48,900 profit after McQuoid tipped off Melbourne that his employer, TTP Communications, was about to be taken over by US mobile giant, Motorola.

(more…)

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