FSA fines oil executives £1.16m for market abuse – On 16 February 2010, the FSA published the Final Notices it has issued to three executives of Genel Enerji A.S. (Genel), a Turkish oil exploration company:
- Mehmet Sepil, chief executive officer, who was fined £967,005.
- Murat Ozgul, chief commercial officer, who was fined £105,240.
- Levent Akca, exploration manager, who was fined £94,062.
The FSA found that all three men had engaged in market abuse, specifically insider dealing in breach of section 118(2) of the Financial Services and Markets Act 2000 (FSMA).
Mehmet Sepil, Murat Ozgul, and Levent Akca (the Genel executives) were actively involved in a joint venture project between Genel and Heritage Oil plc (Heritage), which is listed on the London Stock Exchange. The joint venture concerned the exploration of an oil field in Kurdistan. The progress and results of this exploration were highly sensitive. By 4 May 2009, the Genel executives were aware that the exploration tests had gone well and, on 4 or 5 May 2009, all three men purchased shares in Heritage. On 6 May 2009, following the announcement of the successful testing, Heritage’s share price rose substantially. Later that day, the Genel executives sold their Heritage shares at a profit.
The FSA found that the Genel executives did not intend to commit market abuse and were unaware of the legal requirements prohibiting them from dealing in the Heritage shares.
Each of the fines includes the disgorgement of profits made by the Genel executives. The penalty element of each fine reflects a 30% discount for settling at an early stage of the FSA’s investigation.
Mehmet Sipil’s fine is the largest made by the FSA against an individual for market abuse. The previous highest fine was £750,000, made against Philippe Jabre in August 2006 .
Commenting on this Final Notice, Margaret Cole, FSA Director of Enforcement and Financial Crime, said: “The penalties the FSA has imposed as a result of this investigation send a clear message to companies and individuals wherever they are based that dealing with the benefit of inside information is not acceptable.”
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http://www.fsa.gov.uk/pages/Library/Communication/PR/2010/028.shtml
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