Thursday, 24 July 2014
Last updated 13 hours ago
Jan 27 2012 | 12:35pm ET
British regulators continued to levy fines for insider-trading at Greenlight Capital today—and they may not be finished.
The Financial Services Authority reprimanded Alexander Ten-Holter, a former Greenlight compliance officer and now the hedge fund's trader in the U.K., and JPMorgan Cazenove trading desk director Caspar Agnew for oversight failures. Ten-Holter was ordered to pay a £130,000 fine for failing to ensure that Greenlight founder David Einhorn's order to sell shares of British pub chain Punch Taverns was not based on confidential information. It also barred Ten-Holter from serving as a compliance officer.
The FSA also order Agnew to pay £65,000 for failing to flag the transactions as suspicious.
On Wednesday, the FSA ordered Einhorn to pay £7.2 million for ordering Greenlight to sell its entire stake in Punch after learning, from a broker, that the company was about to announce a round of equity financing. The 2009 sale helped Greenlight avoid £5.8 million in losses.
"Mr. Ten-Holter's approach to compliance oversight was wholly inadequate," the FSA's Tracey McDermott said. As for Agnew, McDermott said he "was an experienced trader," and "so should have been suspicious of this transaction and aware of his responsibilities to report it." McDermott did say that Agnew's "misjudgment" was made "entirely honestly."
Einhorn denied that he had knowingly violated British market-abuse rules, an explanation the FSA accepted.
The FSA is also investigating the broker who allegedly tipped Einhorn off to Punch's plans. Andrew Osborne, formerly of Bank of America Merrill Lynch, could be fined £350,000, Bloomberg News reports.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…