The UK Financial Services Authority (FSA) has continued to use its criminal prosecution powers against insider dealing. On March 31 it announced that seven men had been charged with criminal conspiracy to deal on inside information—one of the accused was also charged with money laundering. These charges follow arrests which took place in July 2008.

The charges against the seven men relate to trading in the shares of 12 companies between May 1, 2006, and May 31, 2008. The companies were all takeover targets during this period and were advised by one of two London investment banks. Two of the men charged worked in the print rooms of those investment banks, where they could have had access to confidential price-sensitive information about takeover bids. The investment banks are not themselves the subject of the FSA’s investigation.

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In an unconnected development, the FSA had announced on March 23 the arrests of six men including senior professionals at leading investment banks and a hedge fund on suspicion of being involved in what the FSA described as “a sophisticated and long-running insider dealing ring” and the FSA’s largest-ever operation against insider dealing. The arrests (the fifth set of FSA insider dealing arrests since the first use of its criminal powers in 2008) resulted in the first joint arrests between the FSA and the Serious Organised Crime Agency. The joint investigation commenced in late 2007.

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