The FSA has fined JP Morgan Cazenove chairman of capital markets Ian Hannam £450,000 for market abuse.
The regulator has today published a decision notice, dated February 27, which says the FSA has found Hannam committed two acts of market abuse.
It says 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 J P Morgan client for which Hannam was the lead adviser.
Hannam has referred the matter to the Upper Tribunal where he and the FSA will each present their case. The Tribunal will then determine the appropriate action for the FSA to take.
The FSA says the September email contained information about a potential offer for Heritage and the October email contained information about a new oil find by Heritage.
The decision notice states that the FSA accepts that Hannam did not set out to commit market abuse but considers that Hannam’s failings were serious in view of his experience and senior position within JP Morgan.
The FSA says the size of the proposed fine reflects the serious nature of the market abuse and should act as a deterrent to other market participants.
FSA acting director of enforcement and financial crime Tracey McDermott says: “Inside information is extremely valuable and must be handled with care to ensure 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”.