British Broker Jailed For Unauthorized ‘Hedge Fund’ Trades

Jul 2 2010 | 10:52am ET

A British stockbroker who tried to hide £42 million in unauthorized trades by pointing the finger at a hedge fund has been sentenced to two-and-a-half years in prison.

Jonathan Bunn gave his bosses at Lewis Charles Securities the names of the traders he said were counterparties to the short-sales when queried about the trades last year. But the firm checked with the hedge fund the brokers were supposed to be working for—and the hedge fund had never heard of them.

The counterparties listed on Bunn’s trading slips also said they had played no part in the trades, leaving Lewis Charles with a £2.67 million loss on an unmatched short position in HSBC Holdings shares.

When confronted, Bunn admitted his misdeeds, and pleaded guilty to false accounting in May.

Lewis Charles said it was forced to lay off a dozen employees and cut salaries by 20% because of the losses suffered in Bunn’s trades.


In Depth

Q&A: Old Hill's Stone On Private Debt, P2P And Credit Bubbles

Jun 6 2017 | 7:52pm ET

While institutional capital continues to flow into the broader private debt sector...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Steinbrugge: Asia-Focused Hedge Funds Offer Great Opportunities

Jun 23 2017 | 3:33pm ET

Emerging market strategies have outperformed their developed-market peers for five...

 

From the current issue of