Home Information Cases R v Securities & Futures Authority Ltd & Ors (2001)

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R v Securities & Futures Authority Ltd & Ors (2001)


The power to impose an unlimited fine for improper trading in financial markets did not render disciplinary hearings for registered traders criminal in nature.


Application for judicial review by a securities and futures trader ('T') of the second respondent's ('the tribunal') decision to dismiss T's appeal against the first respondent's disciplinary tribunal's decision that he had traded improperly for which his registration with the first respondent was suspended for two years and he was ordered to pay £175,000 costs. It was alleged that T and his immediate boss had manipulated the FTSE 100 Index so that T's employer did not have to make a payment under a binary option. As a result, T's company was fined and disciplinary proceedings were commenced against T. T was found guilty of the two charges of misconduct against him on the basis that, although he was acting on his manager's orders, he knew the true purpose of his actions. T submitted the following: (i) the disciplinary proceedings offended Arts.6 and 7 European Convention on Human Rights, in particular because T had been obliged to incriminate himself during the investigation into the unlawful trading, there had been inequality of arms before the tribunal as he had been afforded no legal representation, and the charges against him were too vague; and (ii) s.22(4) and s.7(1)(b) Human Rights Act 1998 meant that the Act had retrospective effect and, accordingly, the appeal tribunal had misdirected itself as to the correct standard for the determination of an appeal.


(1) The element of retrospectivity on which T sought to rely only applied to events after the Act came into force. The Act did not apply to this case as the acts complained of occurred before the Act came into force. However, this decision would reflect the arguments raised as it was clearly important for any regulatory authority to know where it stood in relation to the Convention. (2) In both domestic jurisprudence and in that of the European Court of Human Rights, disciplinary proceedings of the type faced by T were civil proceedings under Art.6 of the Convention. That conclusion was not altered by the respondents' power to impose an unlimited fine which was required by the nature of the markets under regulation. The fine was only recoverable as a civil debt. The fact that the fine was both punitive and a deterrent did not cause the proceedings to become criminal in nature. (3) The privilege against self-incrimination was not an absolute right. The use made of T's answers in interview was entirely appropriate and proportionate. In any event, T had not been compelled to answer the questions put to him during the investigation. Further, there was ample other evidence to prove the case against T. (4) There was no authority for T's proposition that his lack of legal representation before the disciplinary tribunal breached the Convention. T was capable of grasping the facts of his case and the state was not obliged to provide assistance. (5) The complaint as to the vagueness of the charges was not made out because T had admitted that he knew such behaviour was unlawful. (6) The tribunal carried out its duty to revisit and review the evidence and there was no error of law in its approach. On the facts it was clear that the offences were properly established.

Application dismissed.

Queen's Bench Division
Morison J
Judgment date
26 April 2001

​LTL 26/4/2001 : (2001) ACD 375 : (2001) 2 All ER (Comm) 481 : (2001) IRLR 764 : Times, May 15, 2001