Six members of an insider dealing ring have been convicted following what the FSA has said is its longest and most complex prosecution to date.
Ali Mustafa, Pardip Saini, Paresh Shah, Neten Shah, Bijal Shah, and Truptesh Patel have been convicted of disclosing inside information and dealing on the basis of that information between 2006 and 2008.
The conviction follows a four and a half month trial at Southwark Crown Court. The defendants will be sentenced on July 27.
The defendants made a combined profit of over £732,000 on trading between May 1, 2006 and May 31, 2008 by obtaining confidential and price-sensitive information from investment banks relating to proposed or forthcoming takeover bids. They then used a large number of accounts to place spread bets ahead of those announcements knowing when the information was made public the price would rise.
In bringing the case, the FSA had to examine hundreds of trading accounts and telephone records to build up a picture of the timing and degree of contact between those in the insider dealing ring.
FSA acting director of enforcement and financial crime Tracey McDermott says: “The defendants were involved in a long running, sophisticated and very profitable scheme. Several of the defendants derived the majority of their income from the scheme. They took a number of steps to reduce the likelihood of detection and continued throughout the trial to deny any wrongdoing.
“Our success in bringing these individuals to justice is the result of innovative and determined work done across our markets, intelligence and enforcement teams over several years.”
Mitesh Shah was acquitted of insider dealing.
Since March 2009 the FSA has secured 14 insider dealing convictions, in addition to those announced today. The regulator is currently prosecuting four other individuals for insider dealing.