KEYDATA founder Stewart Ford compared the Financial Services Authority to a “runaway train” after a High Court judge ruled that the watchdog acted “unlawfully” in its use of legally privileged emails in its enforcement investigation.
“Right from the beginning I have said the FSA has acted in an underhand way and I believe that the regulator is like a runaway train without any accountability,” Ford told City A.M
The FSA pushed investment firm Keydata into liquidation in June 2009, arguing that it was insolvent and for breaking tax rules.
Ford has repeatedly denied any wrongdoing and maintains that the FSA’s intervention into Keydata caused its collapse.
Judge Ian Burnett ruled yesterday that the FSA used emails sent to Stewart Ford, the chief executive of Keydata, which were covered by legal professional privilege and were therefore private, forcing the regulator to suspend its four-year-old investigation.
The ruling, which marks the first time the regulator has been censured in a judicial review over one of its own investigations, is a humiliating defeat for the FSA, which came under fierce criticism for not policing the banks strictly enough before the crisis.