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Suspect trades pre-empt takeover bids, FSA reveals

‘Suspicious’ trading activity preceded more than 30 per cent of acquisitions in the UK during 2009, a new report has claimed.

Findings from the Financial Services Authority (FSA) revealed that the percentage of trades deemed to take the form of abnormal pre-announcement price movements (APPMs) was higher than the 29.3 per cent seen during 2008.

The figure of 30.6 per cent was the highest since the 32.4 per cent of APPMs recorded during 2004, the report explained.

In its survey, the industry regulator said: “Market abuse is difficult to detect, investigate and prosecute and tackling it is one of our top priorities and we are confident that we have a robust strategy to achieve a credible deterrence.”

Further findings from the FSA’s report revealed that it issued up to 46 fines with a record total value of £33.6 million in 2009.

The industry body also brought two successful prosecutions against insider traders in the 12 month period.

Up to £22 million in bonuses was distributed to FSA staff during the year, a figure which was higher than the £19.7 million paid out the previous year.

By Jim Ottewill