Winterflood Securities Ltd

On 22 April 2010, the FSA published a Final Notice imposing a penalty on Winterflood Securities Ltd (Winterflood) of £4million for committing market abuse. The FSA found that Winterflood had played a pivotal role in an illegal share ramping scheme relating to Fundamental-E Investments Plc, an AIM listed company. In particular, Winterflood had mis-used rollovers and delayed rollovers thereby creating a distortion in the market for shares in Fundamental-E Investments Plc and misleading the market for about six months in 2004. The Fundamental-E Investment Plc share trades executed by Winterflood had a series of unusual features which should have alerted the market maker to the clear and substantial risk of market manipulation. Rather than taking steps to ensure that the trades were genuine, Winterflood continued their highly profitable trading.