A former City banker, his wife and a friend have been sentenced in a £2.15m insider trading scheme uncovered by Financial Services Authority.
Christian Littlewood, a former corporate financier with Dresdner Kleinwort Wasserstein and Shore Capital, has been jailed for 40 months for his part in the trades. The term, the longest insider dealing sentence to date, is the latest in a string of victories for the FSA, which has stepped up its enforcement drive since the financial crisis.
Mr Littlewood's wife, Angie, received a 12-month suspended sentence, while her friend Helmy Omar Sa'aid was sentenced to two years and ordered to pay £640,000 in confiscation. The judge, Anthony Leonard QC, said he had stopped short of sending Mrs Littlewood to jail as he considered it "unjust" to separate a mother from her children.
The Littlewoods were arrested in March 2009 and pleaded guilty in October last year, while Mr Sa'aid was extradited from the Comoros Islands in March 2010 and pleaded guilty earlier this month.
In all, the three pleaded guilty to eight counts of insider dealing in a number of London-listed shares between 2000 and 2008. The insider dealing only came to light after suspicious share purchases by Mr Sa'aid ahead of the Highway Insurance takeover in 2008. Looking at his trading records, the FSA noticed other suspicious trades connected to 21 deal announcements. Though Dresdner bankers were known to have worked on a number of those deals, they had not been employed on the Highway transaction.
The penny dropped when investigators spotted that Mr Littlewood, a Shore Capital banker on the Highway deal, used to work at the German firm. As the inquiry progressed, the FSA took a closer look at movements of money between Mr Sa'aid and an individual named Siew Yoon Lew.
The link proved crucial to the unravelling of the insider trading as further investigations revealed that Ms Lew was, in fact, Mrs Littlewood, who had been using her maiden name in certain trades and in dealings with Mr Sa'aid, a friend from Singapore.
During the investigation, the FSA trawled through mountains of data, including a floppy disk found in the Littlewoods' garden shed detailing how some of the profits were divided. At the sentencing, Mr Littlewood's lawyer claimed that Mrs Littlewood and Mr Sa'aid were more culpable as his client was unaware of the scale of the trades – a suggestion dismissed by the judge.