Seeking certainty

Market manipulation is close to the perfect economic crime, says Clayton Ruthven -difficult to detect, harder still to prosecute and enormously lucrative. He identifies some of the red flags that compliance and investigators in financial services firms should look for if the the manipulator is to face stronger censure than the appellation ‘colourful financier’ in the business pages.

Clayton Ruthven is principal of Ruthven & Co, Parkside House, 17 East Parade, Harrogate HG1 5LF. He can be contacted on: tel 07956 884803/01423 506129

A financial institution that unwittingly facilitates transactions on behalf of manipulators faces the risk that it may become the subject of civil recovery action by the ‘losers’ or enforcement action by regulators with consequent financial and reputational impact. It is unfortunate that while manipulators or their assets may reside outside the jurisdiction, the institution will be perceived to have pockets that are both deep and accessible. Similarly frustrating for the investigator, the level of commercial acumen, market knowledge, and good old-fashioned chutzpah displayed by successful manipulators make it unlikely that they will keep detailed diary notes of just how their scheme worked.