With increasing success in bringing criminal prosecutions against
those who knowingly employ inside information for their own gain, the
Financial Services Authority (FSA) is increasingly turning its sights to
those who unintentionally engage in market abuse.
This year the FSA has imposed heavy fines on two big City names for
unwittingly disclosing and trading off the back of price-sensitive
information. Market participants must wake up to the need for greater
circumspection in dealing with sensitive information, or face stiff
penalties themselves.
To find a market participant guilty of market abuse – albeit the
regulatory and not criminal offence – the FSA need not prove intent
(unlike the US Securities and Exchange Commission). It need only be
satisfied that one of the various ways in which market abuse may be
committed (as set out in section 118 of the Financial Services and
Markets Act (FSMA)) has been proved on the balance...