The Financial Services Authority, the City's regulator, announced yesterday that it had fined an individual for the misuse of price-sensitive information relating for the first time to a company listed on the lightly regulated Ofex market.
The FSA said it had fined Michael Davies £1,000 for trading in shares in the Ofex-listed Berkeley Morgan Group (BMG) while in possession of information concerning the Blackburn-based financial services group's interim results.
Mr Davies had helped to prepare the results, which were better than expected, and had been given a draft copy of the chairman's statement in early December last year.
On 5 January, the day before the public announcement of the group's results, Mr Davies bought 4,000 BMG shares. He sold the shares the day after the results announcement, netting a profit of £420 after the group's share price rose 29 per cent.
The FSA originally considered levying a harsher fine of £4,000 but decided to reduce this on account of Mr Davies' full disclosure of his actions.
Mr Davies, who no longer works for Berkeley Morgan, is the third individual to be fined for market abuse this year, but it is the first for dealings in an Ofex-listed company.
The FSA is investigating allegations of "insider" trading in Marks & Spencer shares before the now-aborted bid by Philip Green. It has already cleared Stuart Rose, M&S's chief executive, of wrongdoing.
Andrew Procter, the director of enforcement at the FSA, said: "This is the first time that we have fined someone for market abuse on Ofex, reminding investors that the FSA can and will take action against market abuse on any of the UK's prescribed markets.
"The FSA has fined three individuals this year using its market abuse powers so the message for senior management is clear: positions of trust should not be abused for personal gain."Reuse content