FSA hands ex-stockbroker £2.8m fine for market abuse

21 May 2010

The Financial Services Authority (FSA) has imposed a £2.8 million ($4 million) fine on a former stockbroker who deliberately ramped up a company's share price.

Simon Eagle agreed to buy 85 per cent of Fundamental E-Investments (FEI) in 2003, with the intention of selling 75 per cent of the stake on.

He then purchased agency-only stockbroker SP Bell, where he installed himself as controller and chief executive and ordered staff working there to sell FEI stock to clients.

This resulted in FEI's share price rising from 2.5p in May 2003 to 11.75p in July 2004, with Eagle paid a commission of £1.2 million by the company's original shareholders.

Margaret Cole, director of enforcement at the FSA, said: "This scheme was rotten throughout and at the core was Simon Eagle.

"He showed a breathtaking disregard for his clients … and for the effect of his scheme on markets."

Eagle has now been banned from working in the financial services.

Earlier this week, the FSA called around 38,000 people in the UK to warn them they may be targeted by boiler room fraudsters and offered worthless shares.

By Tony Aynsley

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