Commodities trader is banned for market abuse

THE City watchdog has fined a former Sucden Financial broker £100,000 for market abuse and banned him from the industry.

It is the first Financial Services Authority (FSA) action taken against an individual for market abuse in commodities.

The regulator took the action after Andrew Charles Kerr tried to manipulate the market in Liffe-traded coffee futures on behalf of a client.

The FSA said the commodity broker, implementing a plan developed with his unnamed client, executed trades during a key period of trading to artificially boost the price of coffee futures.

Kerr’s client did not make the intended profit, the FSA said.

Michael Overlander, chief executive of Sucden Financial, said: “Kerr is a former employee and there hasn’t been any criticism leveled at our internal controls. The FSA acknowledged that we have cooperated fully in their investigation.”

The FSA said Kerr encouraged market manipulation and benefited through his commission on the trades. He also provided false and misleading information during the regulator’s investigation. The regulator said all firms involved cooperated fully with the FSA. Kerr, who agreed to settle the case, was suspended by Sucden pending the investigation and has since resigned.