The panel's executive ruled that Burson committed a 'serious breach of the code' when one of its directors, Hamish McFall, telephoned a number of Sunday newspapers and stockbrokers and implied that Dowty's profits for the year to 31 March next year would rise from pounds 32.7m to pounds 50m. In fact, TI estimates that the profits could be as little as half that figure. Mr McFall's call to a specialist salesman at County NatWest was taped and the tape was passed to the panel.
The panel said that the calls constituted new financial information that should have been communicated to the investing public through a Stock Exchange announcement.
Burson declined to comment on the censure but it is believed that Mr McFall is continuing to work at the firm.
Lazard Brothers, the merchant bank working for Dowty, has also been criticised for failing to exercise full control over Burson. While it accepted the rap over the knuckles, it is understood that Lazard was happy with Burson's work and will use Burson again in takeover bids.
The censure mirrored an incident in April 1990 when there was a leak of the terms of a bid for the property group London & Edinburgh Trust by the Swedish pension fund SPP. Then, the panel said there had been a serious breach of the rules but, despite strong rumours in the City about the source of the leaks, it could not be proven where the information had come from. The panel said everybody concerned had denied responsibility for the leaks.