Paul Milsom, a senior equities trader, has been sentenced to two years' imprisonment for improper disclosure of inside information about forthcoming transactions between October 2008 and March 2010, and ordered to pay compensation of £245,657. This is the first sentence to be imposed in relation to Operation Tabernula, a long-running and complex investigation, conducted jointly by the FSA and the Serious Organised Crime Agency, into an insider dealing ring said to have involved front running of, and spread betting on, trading activity in a significant number of different stocks between 2006 and 2010, on the basis of inside information provided by city professionals.
"Those who work within the industry should be the custodians of its reputation. Milsom’s approach could not have been further from that. His personal greed will have cost him his reputation, his career and his liberty. Those who think there is easy money to be made from insider dealing should think again."
Next steps
In relation to Operation Tabernula, in October 2012, four men (Martyn Dodgson, Andrew Hind, Benjamin Anderson and Iraj Parvizi) were charged with conspiracy to insider deal between November 2006 and March 2010. Richard Baldwin was charged with three counts of insider dealing on 21 December 2012, and Mr Shelley has also been charged with 28 counts of insider dealing. To date, none of them has entered a guilty plea and no trial date has been set. Two of the men arrested in 2010 have not been charged.
Use of personal mobiles
By way of reminder, the FSA's recording rule applies only to mobile phones and other handheld electronic communication devices issued by firms for business purposes, or to phones or devices whose use the firm has sanctioned. COBS 11.8.5A requires firms to take reasonable to prevent an employee or contractor from making, sending or receiving relevant telephone conversations and electronic communications on privately-owned equipment which the firm is unable to record or copy.
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