FSA issues £1.6m fines over market abuse
Two former Cantor Fitzgerald traders went along with Swiss hedge fund manager’s schemes to manipulate closing prices.
The Upper Tribunal has upheld the Financial Services Authority’s decision to issue fines worth more than £1.5m to a Swiss fund manager and a former Cantor Fitzgerald trader over “a serious case of market abuse”.
The Upper Tribunal Tax and Chancery Chamber has directed the FSA to ban and fine Stefan Chaligné, a Swiss-based hedge fund manager £900,000. Mr Chaligné will also be forced to pay a disgorgement of €362,950.
The regulator will also ban and fine Patrick Sejean, a former senior salesman on Cantor Fitzgerald Europe’s London-based French desk £650,000.
Although the regulator will not fine Tidiane Diallo, former junior trader on the same desk, due to serious financial hardship, he will also be banned from performing any role in regulated financial services. Were it not for his hardship he would have faced a fine of £100,000, the FSA said.
Mr Chaligné, a French National who was both the fund manager of and a shareholder in the Cayman Islands based “Iviron” hedge fund, deliberately manipulated the market in a total of nine securities traded on a number of different European and North American exchanges.
He did so by placing orders, through CFE, which were designed to increase the closing price of the securitie, and thereby increase the value of the hedge fund, on two key portfolio valuation dates for the fund.
Mr Sejean and Mr Diallo effected and executed Mr Chaligné’s orders for the purpose of achieving his objectives, the FSA added.