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Business News

Five arrested in FSA insider-trading swoop

Police have arrested a Schroders trader and four other individuals in the latest insider-dealing investigation to rock the Square Mile.

The Financial Services Authority (FSA) flexed its muscles once again as four properties were searched in the City of London, Lincolnshire, Leicestershire and North Yorkshire.

"Five individuals, including two men aged 37 and 62, and three women aged 39, 51 and 63, have been arrested and are currently in custody to be questioned in connection with an investigation into insider dealing and market abuse," an FSA statement said.

"No further details can be confirmed at this time and no individuals have been charged," it added.

Damian Frank Clarke, an equities trader at Schroders, is understood to be one of those arrested.

According to the FSA register, Mr Clarke joined Schroders from Beaumont Capital in 2003 and has no prior disciplinary history.

Schroders confirmed that one of its employees had been arrested and had been immediately suspended. However, it declined to identify him.

"The FSA has informed us that the allegations relate entirely to this individual's personal actions. Schroders is not subject to any investigation. There is no indication of any detrimental impact on our clients or financial results."

Insider dealing is a criminal offence that is punishable by a fine or up to seven years' imprisonment.

Experts have warned that financial crime is likely to continue rising as the impact of the economic downturn bites.

The FSA said the latest arrests were not linked to any other ongoing insider dealing investigation.

The City regulator is currently prosecuting six other individuals charged with insider dealing.