Redmond was employed as a trader on the freight desk of Morgan Stanley's commodities division in London where he traded both freight and oil.

On 6 February 2008, in breach of Morgan Stanley policies and procedures, Redmond built up a substantial short position in WTI Futures on the ICE Futures (Europe) web-based trading platform. He then concealed the position overnight, exposing Morgan Stanley to the risk of incurring a significant loss.

The next day, rather than informing the firm of his actions, he traded out of the position. Redmond only admitted concealing the position when directly challenged by the firm.

Margaret Cole, director of enforcement at the FSA, said: "Redmond's conduct on 6 and 7 February 2008 showed a lack of honesty and integrity that falls short of the standards the FSA expects of approved persons. Having created a large short position which he tried to hide overnight, Redmond continued to get his priorities seriously wrong when he focused on trading out of the position rather than telling his managers. Traders must not seek to conceal their positions from their firms."

The FSA has banned Redmond from performing any function in relation to any regulated activity on the grounds that he is not a fit and proper person. Although he was approved to carry out the "customer" function (CF30), Redmond was carrying out proprietary trading at the time rather than trading customer accounts so there was no risk to consumers.

The FSA took into account that the trading took place over two days rather than an extended period and that there was no risk to consumers. Redmond expressed remorse, admitted his actions and co-operated with the FSA's investigation. His behaviour also appears to have been out of character and unpremeditated. In the circumstances, the FSA has indicated that it is likely to agree to an application from Redmond to lift the ban after two years, provided there is no further evidence of misconduct.

The FSA makes no criticisms of Morgan Stanley or any other individuals at the firm in this case. Morgan Stanley promptly identified and investigated the issue and took swift action against Redmond. He was suspended by the firm on 7 February 2008 and subsequently dismissed. Redmond ceased to be an approved person on 6 March 2008.