The financial Services Authority yesterday imposed fines totalling £4.25m on Winterflood after the brokerage failed to overturn a ruling from an earlier tribunal that the firm, and two of its traders, were guilty of market abuse.
The company, the biggest market maker on the Alternative Investment Market, was handed a £4m fine, while Stephen Sotiriou and Jason Robins were fined £200,000 and £50,000 respectively. The traders are still employed by the firm, but are paying the fines personally.
In June 2008, the FSA found that Winterflood and the traders had played an instrumental role in a share ramping plan, designed to lift the share price of Aim-listed Fundamental-E Investments. None of the parties intended to mislead, the FSA conceded, but said that Winterflood had allowed trades to go ahead, despite "clear warnings that something was amiss. Their actions led to serious losses for investors".