The FCA has fined former Towry adviser Mark Taylor £36,285 and banned him for at least two years for insider dealing.
Taylor, 44, who had worked at Towry for two and a half years, bought shares in Ashcourt Rowan off the back of inside information accidentally provided to him in his role at Towry.
FCA enforcement and market oversight director Mark Steward says: “There can be no let-up in tackling insider dealing and this case shows the consequences will be grave and serious ones for perpetrators, even in small cases like this one.”
Were it not for Taylor providing evidence of financial hardship, the FCA would have imposed a penalty of £78,819.
In February 2015 Towry made an offer to acquire wealth manager Ashcourt Rowan for £2.70 per share. Discussions continued into following month without a deal being finalised.
On 12 March 2015, before any public announcement was made, an internal email was sent to all Towry staff stating the firm had increased its offer to acquire Ashcourt Rowan to £3.49 per share.
After trying to recall the message, a further email was sent to all staff warning them not to act on the information as it was potentially inside information.
Having read both emails and the attempted recall, Taylor, who had previously traded in shares for his Sipp account using a broker, used his online trading account to purchase 5,582 shares in Ashcourt Rowan for a total of £15,011.82.
After the public announcement of the increased offer for Ashcourt Rowan, Taylor then sold his shares for £18,509.91 making a profit of £3,498.
The following day Taylor contacted his broker to ask if it was possible to reverse the trade as he feared he may have been guilty of insider dealing.
The broker declined and reported the trade to the FCA as suspicious in accordance with their obligations.
Taylor was dismissed from Towry for gross misconduct as a result of the incident.
He provided full admissions to the FCA in an early interview and agreed to settle at an early stage of the FCA’s investigation.
The FCA could revoke the prohibition order after two years, on Taylor’s application, in the absence of new evidence that Taylor is not fit and proper.
Towry was acquired by Tilney Bestinvest in April.