In July, the UK High Court held that the Financial Conduct Authority (FCA) was entitled to permanent injunctions and penalties totalling £7,570,000 against five named defendants for committing market abuse. The defendants were found to have committed market abuse in relation to 186 UK-listed shares using a manipulative trading strategy known as “layering”.

The FCA commenced proceedings against the defendants in 2011. Interestingly, this is the first time that the FCA has asked the High Court to impose a permanent injunction restraining market abuse and a penalty.

According to the FCA, the manipulative behaviour consisted of an abusive trading strategy known as “layering”, involving the entering and trading of orders in relation to shares traded on the electronic trading platform of the London Stock Exchange and multi-lateral trading facilities (MTFs) in such a way as to create a false or misleading impression as to the supply and demand for those shares and enabling them to trade those shares at an artificial price.