Rogue trader jailed for losing £3m

A rogue City trader was jailed for two-and-a-half years today after he admitted covering up trades that lost his firm nearly £3m (€3.64m), triggering a dozen redundancies and pay cuts across the board.

Jonathan Bunn, 31, a former inter-deal broker with Lewis Charles Securities (LCS), brought the firm "to its knees" by placing unauthorised trades and then hiding his activities by writing out false deal slips designed to mislead back office employees.

Judge Geoffrey Rivlin, the Honorary Recorder of Westminster, told Bunn: "You were not stealing your company's money but you were gambling with it in a very reckless and dishonest manner."

The judge said Bunn's actions were a "very serious breach of trust" and added: "I think I can fairly say that as a result of your very serious misconduct you have certainly made a very significant contribution to bringing this company, at least temporarily, to its knees."

Bunn was a gambler who owed £60,000 (€72,909) to an online spread-betting company, Southwark Crown Court in central London was told.

He took up a short position equal to 6.95 million shares in HSBC and then lied to LCS by saying he had hedged the trades, insisting that his position was genuine, the court heard.

Bunn, who made £500,000 (€607,576) for LCS and £300,000 (€364,545) commission for himself in just five months at the firm, thought the HSBC shares were overpriced and took a gamble on the price dropping, the court was told.

He then filled in four deal slips to hide the fact he had taken this position.

But the HSBC share price "went up and up and up" and Bunn's gamble "spiralled out of control" as he continued to sell more in a vain bid to average the position out.

David Levy, for the prosecution, said Bunn caused losses of £2,557,026 (€3,107,143) through the deals and a further £322,000 (€391,275) in associated costs.

His actions also caused 12 staff to be made redundant as the firm's profits plummeted and it lost contracts as a direct result of the bad publicity surrounding the case, Mr Levy said.

The remaining staff also suffered 20% salary cuts across the board in a bid to keep the company going.

Gregory Fishwick, defending Bunn, said: "Of course, there was an element of greed in that he wanted to make the commission."

But the profits from the gamble would have been in the tens of thousands, rather than in the hundreds of millions, of pounds.

Bunn's success as a broker was "propping up" LCS and he did not want to admit to his bosses that he had effectively become a failure, Mr Fishwick said.

"He was not a man who was desperate to make a quick buck," he said.

"What started off as a much smaller offence grew beyond his control."

Bunn, who was banned from working in the finance industry by the Financial Services Authority (FSA) in May, admitted false accounting between July 22 and July 24 last year.

He was also thrown out of his home in Weybridge, Surrey, by his wife, and is currently staying which his parents in Manchester, the court heard.

Bunn carried out £38m (€46.18m) of unauthorised trades, Mr Levy, of the CPS's central fraud group, said.

"Bunn went well beyond his authority when he gambled with his employer's reputation and money in the hope of bumping up his commission," he said.

"Today he is paying the price for his actions.

"It is clear he knew exactly what he was doing when, motivated by greed and personal gain, he carried out unauthorised trades worth around £38m (€46.17m)."

More in this Section

Ryanair sues Skyscanner over selling on of flightsRyanair sues Skyscanner over selling on of flights

Shannon-based engineering services firm Mincon eyes growth after €8m acquisitionShannon-based engineering services firm Mincon eyes growth after €8m acquisition

Airbus looks to reduce airline revenue volatilityAirbus looks to reduce airline revenue volatility

Oliver Mangan: Ingredients in place for more sterling volatilityOliver Mangan: Ingredients in place for more sterling volatility


Lifestyle

The incredible life of Ireland’s first celebrity chef has been turned into a play, writes Colette SheridanHow Maura Laverty cooked up a storm

Their paths first crossed on the top floor of the library at University College Cork in October 2010 when both were students there so Amy Coleman and Steven Robinson were delighted to retrace their footsteps on their big day.Wedding of the Week: College sweethearts open new chapter

Peter Dowdall reveals why all roads will lead to Tullow in County Carlow on February 1Snowdrop patrol: Why all roads will lead to County Carlow

I’ve been seeing my boyfriend for a year and we still only have sex at his place because he insists on freshly laundered, ironed sheets on a perfectly-made bed. We both have to shower first. Why can’t he cope with messy spontaneity and my untidy bedroom?Sex Files: Why can’t he cope with messy spontaneity?

More From The Irish Examiner