The Financial Services Authority (FSA) has today fined Mr Erik Boyen, a Belgium based private investor, £176,254 for dealing in the shares of Monterrico Metals Plc, an AIM-quoted company, on the basis of inside information.
The financial penalty includes a disgorgement of profit of £127,254 and an additional penalty of £49,000.
This action follows similar fines imposed on Erik Boyen’s brother, Mr Filip Boyen, and on Mr Richard Ralph, the former executive chairman of Monterrico, last year for dealing using inside information. This fine concludes the FSA investigation into timely dealing in Monterrico shares.
On or about 28 January 2007, Richard Ralph asked Filip Boyen to buy shares in Monterrico on his behalf. At the time, it was publicly known that the company was in takeover discussions and an offer had been made in principle at a premium to the existing share price. Mr Ralph was actively involved in these confidential and highly sensitive discussions and by asking Filip Boyen to buy the shares passed on inside information.
Following Richard Ralph’s request, Filip Boyen asked his brother Erik to buy shares on his behalf, thereby passing on inside information. Erik Boyen, an experienced investor, was aware that the company was in takeover discussions. He also knew that Richard Ralph worked for Monterrico and had asked his brother to buy shares in the company. Between 29 January and 2 February, Erik Boyen bought £16,450 worth of shares for his brother and £332,295 worth of shares on his own account. He later sold all the shares making a personal profit of £127,254 and gave his brother €35,800 as proceeds for the sale of his own shares.
Erik Boyen also encouraged a third party to deal in Monterrico shares.
Margaret Cole, Director of enforcement at the FSA said:
"Erik Boyen used inside information to gain an unfair advantage over other market participants in order to make a substantial profit. Such abuse could damage investors’ confidence in the UK financial markets. The fines given to all three individuals in this case show our determination to take action against everyone involved, when inside information is misused."
Mr Erik Boyen settled at an early stage of the investigation and qualified for a 30% discount on the additional penalty element from £70,000 to £49,000. Otherwise, the total fine would have been £197,254.
