A former partner at JPMorgan offshoot Cazenove is accused of receiving cash at race courses in the UK in exchange for insider information.
The Financial Services Authority (FSA) has launched legal proceedings against Malcolm Cavert, a 65 year-old stockbroker, who stands accused of 12 counts of insider trading, alleged to have taken place between April 2003 and March 2005.
He is reported to have received profits from deals in the form of cash handed over in envelopes at race courses across the UK.
The stockbroker is believed to have received tips and market data from an unknown source at the investment bank.
Information was then passed onto his friend Bertie Hatcher, who is thought to have used the market data to invest in shares in six different companies, which earned the pair £280,000.
After selling the shares, two-thirds of the profit was paid to Mr Cavert by his friend and business partner.
However, Mr Hatcher said in a statement that there was nothing “illicit” about the deals - it “just suited us both”.
The latter is unable to testify in person due to being too ill to make it to court.
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