Top lawyer hits out at long arm of US regulator
David Kosky, associate director of private clients for London & Capital, claimed in May that many advisers “think it simply isn’t worth their while to take on American clients as a result”.
Mr Martin-Artajo and Mr Grout were charged by the SEC on August 14 for their part in the $6bn (3.86bn) ‘London whale’ trading loss, and are alleged to have fraudulently overvalued investments in order to hide massive losses in a portfolio they managed.
A third trader, Bruno Iksil, executed the trades. Mr Iksil was nicknamed ‘Voldermort’ and the ‘London whale’ over his dominant trading track record and large portfolio. He escaped the charges after signing a non-prosecution agreement with the SEC and is co-operating with the authorities.
To-date, neither the FCA nor the SFO has pressed charges.
Justin Urquhart Stewart, marketing director of Seven Investment Management, said: “The SEC will do its best to expand its reach wherever it possibly can. Our regulators need to ensure we stop a regulatory creep towards the US.”
Mark Garnier MP, a member of the Treasury select committee, said: “It is important for the UK’s role in the international community for it to be seen to be meting out justice, and to demonstrate robust regulation. Therefore it is extremely worrying to see the US regulator take this type of action.”
Geraint Davies, managing director of Surrey-based financial planner Montfort International, said: “The US regulator has taken a stance of going everywhere to pursue financial criminals because it clearly does not think that regulatory levels are as good in other countries.”