Ian Hannam, the chairman of capital markets at JP Morgan Cazenove, is understood to have resigned today after the Financial Services Authority (FSA) indicated it would fine him £450,000 for market abuse.
Reuters is reporting Hannam has quit his post to avoid distracting his colleagues while he appeals the action.
He has referred the matter to the Upper Tribunal, where he and the FSA will each present their case and the Tribunal may uphold, vary or cancel the FSA's decision.
In a Decision Notice issued on 27 February, the FSA said Hannam disclosed inside information in two emails sent in September and October 2008 to a prospective client.
The emails contained inside information relating to Heritage Oil Plc, an existing JP Morgan client for which Hannam was the lead adviser.
The September email contained information about a potential offer for Heritage, while the October email contained information about a new oil find by Heritage.
Although the FSA accepted that Hannam did not set out to commit market abuse, it considered his failings were serious in view of his experience and senior position within JP Morgan.
It added the size of the proposed fine reflects the serious nature of the market abuse and should act as a deterrent to other market participants.
Tracey McDermott, acting FSA director of enforcement and financial crime, said: "Inside information is extremely valuable and must be handled with care to ensure that it is properly controlled and that appropriate safeguards are observed.
"This applies to all market participants but is particularly important for senior practitioners who will regularly interact with a wide circle of contacts".
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First mentioned in Cridland Report