Mark Taylor, a former adviser at Towry, purchased shares in Ashcourt Rowan on the back of an email accidently leaked to staff while he was working for the firm.
Leaked memo
In March last year, two months before Towry acquired Ashcourt Rowan for £97m, the firm mistakenly emailed its staff a memo confirming that it had increased its buyout offer from £2.70 per share to £3.49.
Despite trying to recall the memo and warning staff not to act on the information due to insider dealing concerns, Taylor used an online trading account to purchase 5,582 shares in Ashcourt Rowan for a total of £15,011.82.
Taylor, an adviser who worked in retail banking for 22 years, later made a profit of £3,498 on his share sale.
The FCA said he contacted his broker the following day to try to reverse the trade as he feared he may have been guilty of insider dealing. However, the broker declined and reported the trade to the regulator.
Towry dismissed Taylor, who has worked for the company for two and a half years, for misconduct over the incident.
Failure to disclose
The FCA revealed that despite realising he was guilty of insider trading, Taylor did not inform Towry’s compliance function or the FCA of his concerns, although he did provide a full admission at an early interview with the regulator where he agreed to settle.
“I just buried my head and hoped the problem would go away,” he said at a later interview.
Taylor, who had previously used his online account to trade shares for his Sipp, also provided evidence of ‘serious financial hardship’ – prompting the FCA to reduce its initial penalty of £78,819.
Mark Steward, director of enforcement and market oversight at the FCA said: “There can be no let-up in tackling insider dealing and this case shows the consequences will be grave and serious ones for perpetrators, even in small cases like this one.”
