The Financial Services and Markets Tribunal today directed that the FSA fines Mr Arif Mohammed, a former Pricewaterhouse Coopers audit manager, 10,000 for committing market abuse. This is the first time the market abuse provisions in the Financial Services and Markets Act 2000 have been the subject of a Tribunal decision.
Mr Mohammed bought shares in Delta plc, a London Stock Exchange listed electrical and engineering services company, based on his knowledge that the company intended to sell its electrical division. Mr Mohammed became aware of this confidential information because Delta’s electrical division was an audit client of PwC and Mr Mohammed worked on the company’s audit.
David Mayhew, acting director of enforcement at the FSA says:
“Mr Mohammed, as an auditor, knew he should not be dealing in Delta shares. Similarly, the market would expect an auditor not to deal in shares of an audit client. To abuse his position by essentially cheating for personal gain, is a breach of trust and undermines the integrity of the market. ”