Trader fined and banned for trying to rig UK bond market
A top City trader was fined nearly £700,000 and banned for life for manipulating the price of government bonds in an attempt to profit from the taxpayer-backed money printing programme known as QE.
Mark Stevenson, who earned £2.4m-a-year in his job at Credit Suisse, even described the Bank of England’s help that he was abusing as “cake” – trader jargon for a sweet opportunity for a profit.
The 51-year-old had been a trader for nearly 30 years when he came up with a scam to overcharge the Bank for bonds it was offering to buy under its quantitative easing support programme.
After the global financial crisis, the Bank of England launched QE to push money into the economy in the hope of encouraging spending. It did this through the banking system, by offering to pay high prices for banks’ holdings of government bonds.
However, Mr Stevenson tried to use the programme to make a quick profit, by buying huge amounts of one particularly obscure type of bonds, driving up the price before selling them to the Bank of England.
Over the course of five and a half hours on 10 October 2011, he bought £331m-worth, and, as a result, its value shot up.
However, within 40 minutes of him putting his plan into effect, other traders had noticed and tipped off the Bank. When he offered to sell the bonds at the end of the day, the Bank turned him down and they fell back to their normal value.
The Financial Conduct Authority watchdog’s director of enforcement Tracey McDermott said: “Stevenson’s abuse took advantage of a policy designed to boost the economy with no regard for the potential consequences for other market participants and, ultimately, for UK taxpayers. He has paid a heavy price for his actions.”
Just how heavy that price was for a man of Stevenson’s wealth was in some doubt, however.
His fine for manipulating the market was reduced from £948,000 because he agreed to settle at an early stage in the investigation. In the end it was less than a third of the £2.4m he earned in the previous year. Meanwhile, his ban from trading came at a time in his life when he was already way beyond the retirement age of many City traders.
He left Credit Suisse last year.
- 2 Disney heiress Abigail disowns her share of family profits in West Bank company
- 3 The secret report that helps Israel hide facts
- 4 'Women should not laugh in public,' says Turkey's Deputy Prime Minister in morality speech
- 5 Israel's propaganda machine is finally starting to misfire
A former custard factory, a Midlands bog and a Leeds cemetery all included in top 50 hidden spots in the UK
Sabina Altynbekova, the girl branded 'too good looking' for volleyball, says social media obsession with her is a 'bit much'
Disney heiress Abigail disowns her share of family profits in West Bank company
'Women should not laugh in public,' says Turkey's Deputy Prime Minister in morality speech
Drew Barrymore’s sister Jessica found dead in her car surrounded by 'dozens of white pills'
The secret report that helps Israel hide facts
Woman and two children killed by mob in riots over 'blasphemous' Facebook post in Pakistan
A day in the life of Vladimir Putin: The dictator in his labyrinth
Putin is 'thuggish, dishonest and reckless', says British ambassador to US
Richard Dawkins tweets: 'Date rape is bad, stranger rape is worse'
Boozy, ignorant, intolerant, but very polite – Britain as others see us
- < Previous
- Next >
iJobs Money & Business
£600 - £700 per day + competitive: Orgtel: Senior Investment Accounting Change...
£450 - £650 per day + competitive: Orgtel: My client, a leading bank, is curre...
£350 - £400 per day + competitive: Orgtel: Senior Analyst, ALM Data, Halifax, ...
£500 - £600 per day: Orgtel: Java developer - Banking - London - Up to £600/d...