The former head of tax at the Morrisons supermarket chain has been jailed for a year after pleading guilty to insider dealing, from which he made £79,000 of profits.
Paul Coyle, who was also group treasurer of the Bradford-based business, made his plea at Leeds crown court to the charges brought by the City regulator, the Financial Conduct Authority. He was also ordered to pay £15,000 towards prosecution costs and subjected to a confiscation order for £203,234.
As he passed sentence the judge Mr Justice Globe said “the offending was so serious that an immediate custodial sentence must be imposed”.
Georgina Philippou, director of enforcement and market oversight at the FCA, said Coyle had committed “a serious breach of trust” by using information he had about an impending tie-up with the online retailer Ocado.
“Abuse of inside information in this way undermines the integrity of the UK financial markets. We are committed to prosecuting insider dealing to ensure our markets remain a ‘level playing field’ for all participants,” she said.
Coyle was arrested in December 2013 in Harrogate, North Yorkshire when the investigation – which covered the period from January to May 2013 – was underway. He had been charged in September with two offences of insider dealing in Ocado shares.
Ocado shares had surged in May 2013 when the online food retailer announced an agreement with Morrisons to deliver goods ordered online by the supermarket’s customers. Ocado’s shares rose by as much as 50% in early trade on the day the deal was announced, dropping back to end 29% higher on the day.
A Morrisons spokeswoman said: “While this was a regrettable case of an individual acting alone, we are pleased that our governance and processes were sufficiently robust to enable the authorities to achieve a successful prosecution. We are also pleased that the case has concluded and that the FCA’s investigation did not raise wider concerns for the company.”
Coyle, 50, used two online accounts in the name of his partner for the trading activities which the City regulator has been making efforts to stamp out. The FCA said that along with its predecessor body the Financial Services Authority, it had secured 26 convictions in relation to insider dealing and has charged seven other individuals with similar offences for trails scheduled to take place next year.