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FCA fines investment banker for sharing confidential client information

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A former investment banker has been fined £37,198 by the FCA after he shared confidential information about clients over messaging service WhatsApp.

Jefferies International investment banking managing director Christopher Niehaus shared confidential information with two people: one a personal acquaintance, and one a friend who was also one of the firm’s clients.

The information included client identities, the mandates his firm was working on, and the fees Jefferies was charging and, in one instance, information about a competitor.

“Niehaus also boasted about how he may be able to pay off his mortgage if one of the deals was successful,” the regulator’s fine notice reads.

The FCA says that Niehaus shared the information “because he wanted to impress the people that he shared the information with”.

His position gave him “extensive access” to confidential client information, which he shared between 24 January 2016 and 16 May 2016.

The regulator found that neither the acquaintance nor friend traded on the information received, however, and that this was not what Niehaus was expecting them to do.

Niehaus was able to get a 15 per cent reduction on his fine for settling with the FCA early, sparing him a £53,140 fine.

Yesterday, research from the New City Agenda think tank suggested that, in total, financial firms and individuals have saved around £1.2bn on FCA fines over the last four years due to the regulator’s settlement discount mechanism.

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. What’s app is securely encrypted. So how did the Regulator find out? It could only be if one of the recipients shopped him and showed the messages to the Regulator.

    Boy, what a world! The SS, KGB and Stazi would be proud.

    • Whatsapp only turned on encryption a year ago given the speed of the regulator and our judiciary system I’m not sure it would have been encrypted at the time of the offence.

  2. Now he can show off how rich he is by the size of his fine!

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