Staff at Abn Amro Equities have been wrapped over the knuckles by the FSA for trying to boost share ...
Staff at Abn Amro Equities have been wrapped over the knuckles by the FSA for trying to boost share values to a higher level on three separate occasions in 1998 and fined a total of £970,000.
Two separate fines of £900,000 and £70,000 have been issued, but the smaller amount is presented directly to Michael Ackers, AAE's then head of the UK equity trading desk, after the FSA discovered several problems with compliance failings, market misconduct and breach of trading rules.
Irregularities with trading were found in relation to four stocks - Carlton Communications plc, British Biotech plc, Volkswagen AG and Metro AG - and several different traders, says the FSA, as they acted under the instruction of a US sales trader to move the market price.
Trading in stocks simply to move the market price is a serious abuse: it distorts market forces and undermines investors' confidence in the integrity of the prices quoted on exchanges.
Compliance officer of the time at AAE had pointed out to management that there were problems with compliance functions as well as shortcomings in the procedures, policing and training of staff, but still nothing was done, says Carol Sergeant, Managing Director of the Financial Services Authority.
An FSA statement points out that the fine issued to AAE does take into account the changes which have been made at the investment house since problems were discovered five years ago.
Ackers, the then joint head of desk at AAE, has since been disciplined for his involvement in one of the three instances of market misconduct while a second individual, then director of UK equities, was previously suspended for three years by the pre-N2 SFA, before returning to work on December 23, 2001.
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