He’ll be sunning himself on the Costa Brava by now, laughing at us all through the bottom of his gin & tonic.
CITY WATCHDOG FAILS TO SNIFF OUT CONSPIRACY OF SHORT SELLERS
FSA ADMITS DEFEAT AFTER HBOS PROBE
‘NO ACTION’ BY FSA AFTER ABUSE PROBE
MP CALLS FOR NEW FSA POWERS AFTER PROBE FAILS
The FSA has wrapped up its investigation into the sudden plunge in HBOS stock back in March, when rumours of funding problems sent the price down 18 per cent one morning. That caused the Bank of England to make a series of unprecedented calls to the media, warning newspapers and broadcasters that the rumours were untrue and that reckless repetition could cause a run on the bank.
The regulators promised a thorough investigation, with those apparently abusing the market likely to face prosecution. But three months on, despite sifting through thousands of emails and instant message conversations, the FSA has not been able to find sufficient evidence against any individuals.
Cue a demand from John McFall, chairman of the Treasury select committee, who really should know better:
The law needs to change because the number of prosecutions that have been brought [for market abuse] is disgracefully low.
What abuse? Back in March, when the bank-bashing really got going, shares in HBOS were trading at 528p; this Monday the stock was at 280p. The price has all but halved because the bank ran into funding difficulties and had to launch a deeply-discounted rights issue.
The specifics of the rumours at the time were wrong, but the sentiment was spot on. Trying to legislate against people having an opinion is futile.
LINK UPDATE:
‘It will surprise people.’ FSA gets to heart of HBOS share scandal – Independent on Sunday
It’s now known what happened. It will surprise people what’s been found.
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