View more on these topics

Tribunal upholds FSA ban and fine for Swiss fund manager

FSA large 480

The Upper Tribunal (Tax and Chancery Chamber) has upheld a decision by the FSA to ban and fine a Swiss fund manager and two Cantor Fitzgerald traders.

The decision means Swiss hedge fund manager Stefan Chaligné faces a £900,000 fine, plus disgorgement of the financial benefit of €362,950.

Former Cantor Fitzgerald salesman Patrick Sejean faces a £650,000 fine, while ex-junior trader Tidiane Diallo will not pay a fine after the regulator accepted he was in a position of serious financial hardship.

Diallo would have faced a £100,000 if the regulator had sought to take action. All three have been banned from performing any role in regulated financial services.

Diallo and Sejean both worked on the French desk at Cantor Fitzgerald.

Chaligné was found to have “deliberately manipulated the market in a total of nine securities traded on a number of different European and North American exchanges” by placing orders through CFE designed to increase the closing price of the securities.

The manipulation increased the value of the Iviron hedge fund on two key portfolio valuation dates for the fund.

The practice known as “window-dressing the close” occurred with eight securities on 31 December 2007 and with securities on 31 January 2008.

According to the regulator, the increases allowed Chaligné to present a positive view of the performance of the fund at a time of difficult market conditions “and thereby present himself as a competent fund manager”.

Sejean and Diallo effected and executed Chaligné’s orders.

While Diallo was involved on one of the dates, Sejean was involved on both dates and “deliberately influenced and involved more junior members of staff”.

The tribunal increased Sejean original £550,000 fine, but is due to hear claims of serious financial hardship.

FSA director of enforcement and financial crime Tracey McDermott says: “Chaligné was an experienced hedge fund manager who engaged in a deliberate scheme of market abuse to benefit his own interests.

“His scheme involved UK-based traders and impacted several markets across Europe and North America.

“The significant penalty and ban, along with the Tribunal’s comments, underscore the seriousness of his misconduct.”

McDermott says Sejean “has no place in the financial services industry” adding that he had “exploited and abused his position”.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm