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The U.K.’s Financial Services Authority has handed out a $4.51 million dollar fine against the former Chief Executive of JC Flowers U.K., The Wall Street Journal reports.The amount Ravi Sinha has been ordered to pay for fraud is one of the highest individual fines ever handed out by the FSA. The fine includes both repayment of the illicitly obtained funds and a punitive fine.
This case comes as the FSA is ramping up enforcement actions. Most notable was last week’s $11 million against Greenlight Capital, the American hedge fund managed by David Einhorn.
The Journal reports that Sinha’s fraud involved submitting false invoices to companies owned by JC Flowers that were payable to himself and using the cash to cover debt incurred on other investments that had gone bad. The effect was to illegally transfer funds among JC Flowers’ U.K. portfolio companies.
JC Flowers said they immediately investigated the fraud as soon as it came to light, fired Sinha and alerted the FSA.