The battle by Malcolm Calvert over charges he was involved with insider trading at the Cazenove unit of JPMorgan Chase (NYSE:JPM) continues in London, as his lawyer communicated to a jury in London that there wasn’t any evidence concerning Calvert partaking in insider trading.
Charges against Calvert by prosecutors are he allegedly received information from someone at the London brokerage, which he then supposedly gave to an acquaintance.
The entire case is build on the performance of investment recommendations by Calvert, and not actual evidence, according to his attorney, and he does have a point there.
The prosecution is basing its case on the advice given by Calvert to a Bert Hatcher concerning investing in six different firms. Each trade ended up doing well.
According to the prosecution, each trade was entered into before certain announcement were made which would move the markets in the U.K.
While Calvert did work for the Cazenove division of J.P. Morgan, he had retired before the dates in question brought up in the trial, which were from 2003 to 2005. The assumption is because Calvert formerly worked at the firm, he consequently must have had someone on the inside providing the information.
An odd part of the case is the alleged recipient of the benefits of the trade, Bert Hatcher, is now suffering from dementia, and was unable to testify. All the FSA has is a written statement from Hatcher that he had received tips from Calvert. Included with the statement is the idea that Calvert may have received information from an inside source, although absolutely no information was provided as to who that source was or how the communications went on.
Problems with the assertions are if everyone offering tips to a client are prosecuted and/or jailed bacause they pan out, every financial advisor in Britain could end up being jailed if that were the case, something the lawyer of Calvert rightly points out.
This does seem to be a trial that should have never happened based on the evidence provided, or lack of it. It’s too bad the pressure to find scapegoats for the economic crisis could end up with innocent people going to jail because they successfully gave solid advice to their clients.