A former investment analyst has been fined £50,000 for using Bloomberg Instant Messenger to send "misleading and inaccurate disclosures" about a listed company, affecting its share price.
The Financial Services Authority says that in May 2008 Christopher Gower, a former senior research analyst at MF Global Securities, attended a meeting with the CEO of Punch Taverns.
After this he sent out an instant message entitled 'hot off the press' to 14 clients, a Bloomberg reporter and members of his firm's sales team, claiming that Punch had heard that another company, Enterprise Inns, has been granted real estate investment trust (Reit) status.
The message was widely circulated in the market and trading in Enterprise Inns shares trebled, with the price rising by over four per cent in around two hours.
Yet the IM did not accurately reflect the conversation Gower had had, giving the impression of inside information, says the FSA. Although the watchdog accepted he did not mean to give a false impression, "his conduct was careless and fell below proper standards of conduct in the circumstances".
Margaret Cole, MD, enforcement and financial crime, FSA, says: "There is no excuse for a senior retail analyst to be so careless with messages that could have such an impact on the market. Gower's dissemination of inaccurate information contributed to a large increase in the volume of shares traded and a disorderly market in ETI shares."
You can read the final notice here:Download the document now 228 kb (PDF File)