THE UK’s tribunal system has upheld the Financial Services Authority (FSA) decision to ban two hedge fund executives and fine them a total of £2.1m for market abuse and deceiving investors.
Michiel Weiger Visser, who was chief executive of Mercurius Capital Management at the time of the abuses, was handed a £2m penalty for breaching management restrictions and placing the fund in a “precarious position”.
The company’s International Fund, which Visser managed, had approximately 20 investors and €35m under management when it collapsed and was placed into liquidation in January 2008.
His finance chief and compliance officer Oluwole Modupe Fagbulu was fined £100,000 – reduced from the FSA’s original £350,000 fine on the grounds it would leave Fagbulu in “serious financial hardship”.
Visser was accused of market manipulation to disguise the performance of the fund, after flouting rules that left the fund’s risk concentrated in a small portfolio of illiquid stocks.
Fagbulu was not involved in investments, but he wilfully passed false information to investors, and was responsible for oversights related to his compliance role.
“Visser and Fagbulu’s conduct fell woefully short of the standards required of approved persons,” said the FSA’s acting director of enforcement and financial crime, Tracey McDermott (pictured).