On December 15, 2020, the Financial Conduct Authority fined Corrado Abbattista, a former hedge fund portfolio manager at Fenician Capital Management LLP, £100,000 (over $134,000) for market abuse, in violation of Article 15 of the Market Abuse Regulation. In addition to the financial penalty, Abbittista is also prohibited from performing any function related to any regulated activity.
According to the Final Notice, between January and May of 2017, Abbattista placed large orders for Contracts for Difference (CFDs), referenced to various equity trades that he had no intention of executing, and at the same time placed much smaller orders on the opposite side of the order book which he fully intended to execute. The FCA alleges that as an experienced trader, Abbattista knew that market participants would have no way of knowing that he had placed orders to both buy and sell at the same time, and should have known that it would give the impression that a material buyer was in the market, thereby driving the price of shares higher than if the misleading trade was never posted. Even though Abbattista was aware that these actions could be perceived as market manipulation, he recklessly participated in this behavior on more than one occasion.
The Decision Notice regarding these penalties was actually issued on July 22, 2020, but in August of 2020, Abbattista referred the matter to the Upper Tribunal. The Final Notice was issued only after Abbittista decided to withdraw his reference with the Tribunal’s consent.