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As the UK economy continues to dive bomb towards recession the Bank of England has given its most blatant indication to date that interest rates will fall again in January. The indication was that...
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Saturday 2nd August 2008
While the Financial Services Authority (FSA) launched an investigation into short selling and false rumours about HBOS in a blaze of glory, it has had to call a halt to the issue 5 months later. Even though the authorities are sure that false rumours were swirling around the market prior to the substantial fall in the share price in mid March, they have been unable to pinpoint the origin of the stories.
Those who followed the issue at the time will note that it was alleged that short sellers were able to push the HBOS share price to well below the rights issue price with a mixture of genuine concern and false rumours. The FSA has not been able to uncover a concerted effort to undermine the share price and has now admitted defeat in its pursuit of those possibly guilty of market abuse.
While it is disappointing that the FSA was unable to put together a case for prosecution there has been a sea change in its approach to market abuse of late. The recent arrest of eight suspects on a separate matter has brought the issue very much to the surface and spread some concern in markets. Wild claims of mass insider trading on takeovers and mergers has yet to be substantiated by those who might even consider becoming involved in market abuse may be forced to think again. |
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