The FSA Just Handed Out More Fines Related To Greenlight Capital Insider Trading


Hedge fund manager David Einhorn and his fund Greenlight Capital aren’t the only ones receiving fines by the U.K.’s Financial Services Authority related to the hedge fund’s alleged insider trading/market abuse.

The FSA fined Alexander 10-Holter, a trader and former compliance officer for Greenlight Capital, £130,000 (~$204,165) for “failing to question and make reasonable inquiries before selling Greenlight’s shareholding in Punch Taverns PLC ahead of an anticipated significant equity fundraising by Punch in June 2009, and prohibited him from performing Compliance Oversight and Money Laundering reporting functions,” the regulator said in a release.

“Alex is a valued member of the Greenlight team and our trader in the UK.  We believe that the FSA’s action against him is unwarranted.  He has our full support,” Greenlight said in a statement.

The British regulator also slapped a £65,000 (~$102,082) fine on Caspar Agnew, a trading desk director at JPMorgan Cazenove for “failing to identify and act on a suspicious order from Greenlight to sell Punch shares that allowed the firm to be used to facilitate insider dealing or market abuse.” 

The FSA claims that Einhorn and his fund traded stock in Punch Taverns on inside information back in 2009 minutes after a telephone conference call where the bar and pub operator’s CEO and banker said the company would need significant equity raising.

Einhorn has said Wednesday during a conference call that he completely disagrees with the FSA’s decision.  However, his fund will not seek further litigation because he doubts his fund’s chance of a fair hearing.

“This is like a traffic cop with a quota at the end of the month, with a miscalibrated radar gun” Einhorn said during the call

Einhorn and Greenlight were fined £7.2 million (or $11.2 million).

SEE ALSO: David Einhorn Tells His Side Of The Story On The FSA’s Insider Trading Fine >>