Malcolm Calvert, the former partner at JPMorgan Chase & Co. (JPM:US)’s Cazenove unit who is serving a 21-month sentence for insider trading, may have to forfeit about 1 million pounds ($1.5 million), a London court heard today.
The U.K. financial regulator asked Judge Peter Testar to rule that Calvert must pay 473,955 pounds for confiscation of his profits from trades made with inside information, plus interest; and another 482,908 pounds in costs for his prosecution. Calvert’s attorney, Hugo Keith, argued the Financial Services Authority calculated the forfeiture amount incorrectly, and that the agency’s costs were “grotesque.”
Calvert, who arrived at court today from Ford Open Prison in a grey sweater and pants, was convicted last month in the FSA’s third criminal insider-trading case to reach a jury trial. The FSA has pledged to bring more charges and be a tougher regulator, after pledges by opposition Conservative lawmakers to carve up its powers if they win next month’s election.
“The criminality of insider dealing is trading with a view to a profit,” Keith told Southwark Crown Court today, arguing against the FSA’s view that the benefits of Calvert’s crime equal two-thirds of the value of the shares when they were sold. This reflects the arrangement that Calvert had with the key prosecution witness, Bert Hatcher, the FSA said.
Keith is also seeking to reduce the 70,000 pounds of interest sought by the FSA because of delays in bringing Calvert’s case to trial. He was first arrested in April 2006. Testar said he would make a judgment within two weeks.
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