This is the first time the regulator has handed down sanctions for illegal acts on the credit markets.
The Financial Services Authority (FSA) has banned a fund manager for a year after he was found to have conducted insider trading, it announced today.
Steven Harrison, who formerly worked as a hedge fund manager, has also been fined a total of £52,000. The action marks the first time in which the City regulator has cracked down on the UK's credit markets.
The fund manager was found to have used inside information on the financial restructuring of French chemicals firm Rhodia for his professional gain, although the FSA also said that his actions were not deliberate as he did not know that the information, which was gained from the Credit Suisse brokerage, was not in the public domain.
Mr Harrison's illegal trade occurred after he found out that Rhodia's refinancing strategy included the buying back of some of its bonds. He then told a colleague to buy these bonds before the plans were announced, and his employers, Moore Credit Fund, made a £36,000 profit on this deal.
Margaret Cole, FSA director of enforcement, said: "Hedge fund managers and people in similar roles are often legitimately provided with inside information in the course of their business. The FSA expects people entrusted with such responsibility, in the credit markets as much as in any other regulated markets, to observe high standards of conduct and not to take advantage of their privileged access to inside information."
The insider trading occurred on 28th September 2006.
