On May 20, the UK Financial Services Authority (FSA) announced that it had fined Simon Eagle £2.8 million (approximately $4 million) and prohibited him from working in financial services as a result of the deliberate market abuse scheme he had carried out in 2003-2004. The fine, made up of a penalty of £1.5 million (approximately $2.2 million) and disgorgement of profits of £1.8 million (approximately $2.6 million), is the largest fine ever imposed by the FSA on an individual.

Mr. Eagle acquired SP Bell Ltd (SPB), an agency stockbroker, in May 2003 and became its chief executive. Between July 2003 and May 2004 he carried out a complex and prolonged scheme that ramped up the share price of Fundamental-E Investments (FEI) for his own benefit at the expense of other FEI investors and misusing accounts of SPB clients.

This case is linked to the fines totalling £4.25 million (approximately $6.2 million) imposed on Winterflood Securities Limited and two of its traders (as reported in the April 3, 2009, edition of Corporate and Financial Weekly Digest and confirmed on April 22, 2010, after an appeal to the Court of Appeal) for their role in misuse of rollovers and delayed rollovers that created a false market for FEI shares and misleading the market.

FSA Director of Enforcement and Financial Crime Margaret Cole said: “This scheme was rotten throughout and at the core was Simon Eagle. He showed a breathtaking disregard for his clients, for his duty as an approved person and chief executive and for the effect of his scheme on markets. He has played procedural games in an attempt to avoid being held accountable for his actions and this tough action shows that we are determined to keep dishonest cheats, like Simon Eagle, out of financial services.”

To read more about Simon Eagle, click here.
To read more about Winterflood, click here.