Ian Hannam, one of the City's biggest deal makers, has quit as chairman of capital markets at JPMorgan Cazenove after being fined £450,000 by the Financial Services Authority (FSA).
Mr Hannam, who is advising Xstrata on its $90bn (£56bn) merger with Glencore, will leave once that deal is completed in the summer. He is appealing against the FSA fine.
The FSA said Mr Hannam had sent out emails to two potential clients in Kurdistan talking about a possible bid for his client Heritage Oil and later a new oil find by the company. This was inside information which he should not have disclosed, the watchdog said.
The regulator said while Mr Hannam had not set out to commit market abuse, it had to take his failing seriously because he was such a senior and experienced banker. It added: "He was a role model for the people that worked for him and for others at JPMorgan."
Mr Hannam had been a key adviser to Heritage Oil and its chief executive Tony Buckingham since 2007. The explorer had interests in Kurdistan.
Two years ago the FSA fined three Turkish oil executives £1.2m for insider dealing in Heritage shares. Since then it has trawled through 20,000 emails relating to the explorer and its advisers.
In September 2008, Mr Hannam sent an email to "Mr A", a Kurdistan business representative, and blind-copied it to another Kurd businessman, "Mr B", which read: "I thought I would update you on discussions that have been going on with a potential acquirer of Tony Buckingham's business... I believe the offer will come in in the current difficult market conditions at £3.50-£4 per share." The FSA said Mr Hannam knew the organisation Mr A represented might be considering buying a stake in Heritage.
In October 2008 an email was sent to members of his team and to Messrs A and B. It had the footnote: "PS – Tony has just found oil and it is looking good." The FSA said it would have been clear this related to a Heritage well in Uganda.
Mr Hannam said: "I strongly believe, and have been advised by my legal counsel, that the FSA's conclusions are wrong and I look forward to challenging them in an independent tribunal."Reuse content