Bloomberg News

FSA Loses Bid to Ban Ex-Commerzbank Trader Over Market Abuse

September 02, 2011

(Updates with lawyer’s comment in sixth paragraph.)

Sept. 2 (Bloomberg) -- A former metals trader at Commerzbank AG’s Dresdner Kleinwort unit won a U.K. tribunal ruling preventing the Financial Services Authority from banning or fining him in a market abuse case over lead contracts.

A U.K. tribunal limited the FSA to censuring Jason Anthony Geddis over the 2008 trades on the London Metal Exchange, the regulator said in a statement today. Geddis had challenged the FSA’s decision issued last year.

“The tribunal felt that a public censure was a more appropriate penalty,” the FSA said in the statement. “The tribunal determined that Mr. Geddis’s conduct in creating a disorderly market fell below the proper standard of care, but it was not a failure of integrity.”

The FSA banned 71 people from working in the industry and issued fines of 98.5 million pounds ($159.6 million) in the year that ended March 31, 2011, according to the regulator’s annual report. The regulator alleged Geddis committed market abuse and violated LME trading guidelines by building a position of more than 90 percent of warrants for lead stockpiles, without lending back to the market.

Geddis’s lawyer, Michael Segen of Segens Solicitors in London, didn’t immediately return a call for comment.

The tribunal considered Geddis’s “exemplary” record prior to his disputed trade, and could encourage other people to challenge FSA decisions, said Jonathon Crook, a lawyer at Eversheds LLP in London, who wasn’t involved in the case.

“The tribunal concluded that despite the failings which gave rise to the FSA’s complaint, the fact that this was a one- off occurrence as a result of a lack of care did not justify the imposition of a financial penalty,” Crook said.

--With assistance from Lindsay Fortado in London. Editors: Anthony Aarons, Claudia Carpenter

To contact the reporter on this story: Erik Larson in London at

To contact the editor responsible for this story: Anthony Aarons at

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