THE FSA’s approach was slammed as “un-British” yesterday as it hit star JP Morgan Cazenove banker Ian Hannam with a £450,000 fine, prompting his resignation.
David Davis MP, a prominent Tory backbencher, said the regulator’s disciplinary process is against traditional principles of British law.
He called the FSA’s action against Hannam “unbelievable”, saying: “It’s un-British. There should be equality of arms”, meaning that the process should be a fair fight between prosecution and defence.
“This is an incredible extension of what constitutes insider trading by the FSA,” he added. “It’s quite an astounding pattern of behaviour by the FSA.”
Hannam quit his job as chairman of equity capital markets at JP Morgan Cazenove yesterday in order to launch a full-scale defence of his case at an independent tribunal, which could take up to 18 months.
The FSA said he had committed “market abuse” by leaking inside information about bid talks and oil discoveries made by his client Heritage Oil, to another client in the sector.
One banker close to Hannam said: “It’s a massive scalp for the FSA… They’re dancing on the grave of our dying industry.”
However, others were more supportive of the FSA. One senior enforcement lawyer said: “The FSA is quite entitled to take the action it’s taken. He [Hannam] is clearly an insider and passed on information in breach of confidentiality.”