I have had a chance now to listen to the oral arguments given in the Mark Johnson appeal and while my underlying belief that this is a wrong conviction remains unshaken it is also clear to me that few involved in this case from the legal fraternity actually understand foreign exchange markets and how they […]
Tag: Cairn Energy
I may, not for the first time, be reading too much into a brief sentence, but I found it significant in my conversation with Simon Potter, outgoing chair of the Global FX Committee, that when talking about the review of the Code he mentioned “the handling of larger orders” as one area of possible review. […]
The news this week that the US government has failed to prosecute another FX trader is yet another indication of both the eagerness of the authorities there to have a “head” to represent the general misconduct of bankers, as well as those same authorities’ lack of understanding as to how the FX market works. In this case, as well as that of Mark Johnson, there is more than enough evidence to indicate the “customer” knew perfectly well how the FX market operates and therefore were most definitely not “victims”.
I have previously argued that the FX industry needs to pay attention to the outcome of the Mark Johnson trial. Reading through the appeal documents, however, indicates the stakes have been raised. The prosecution’s original case was, in my opinion, flawed when looking at how the FX market works, but the new charges take this to a new level and they throw into a harsher light the reluctance of certain trade associations to engage and educate the US authorities earlier in this case – we can only hope it is not too late.
The defence team conducting former HSBC FX trading head Mark Johnson’s appeal against his conviction in late 2017 have filed their appeal brief to the US Court of Appeal, in which they argue that the US Government’s brief offers, “…the latest flavour of the prosecution’s many ever-shifting, imprecise, and contradictory attempts to explain just what, exactly, the crime here was, and it exposes why there was none.” It highlights a series of new arguments put forward by the Government that were not heard by the jury, as well as a series of back tracks by the prosecution side.
ACI – The Financial Markets Association (ACI FMA) has filed an Amicus Brief on behalf of former HSBC FX trading head Mark Johnson, who is appealing his conviction and sentencing earlier this year for several wire fraud offences.
In the Amicus ACI says that if the US government’s “Illogical” position is allowed to stand, and the conviction is not overturned, bank dealers are unlikely to operate in the face of potential criminal sanctions simply for transparently and fairly hedging the uncompensated risk of “colossal loss” to their shareholders.
Mark Johnson has won his bail application in the US Appeals Court and will been released subject to terms laid down by the District Court.
Three judges of the US Court of Appeals for the Second Circuit, granted the bail application Wednesday, which suggests that as well as seeing Johnson as no flight risk, they also believe there are credible legal issues surrounding the original conviction.
Johnson was found guilty of several counts of wire fraud and sentenced to two years in jail in an original decision that potentially has tremendous consequences for the FX industry.
I have been reading through the application for bail lodged by Mark Johnson’s lawyers following his conviction and sentence to two years’ jail and not only do I think it previews his full appeal, but while I understand the job of the counsel is to make the best case they can by stretching facts to the limit, my natural reaction has also been that something went badly wrong during the trial for the verdict to be delivered the way it was.
Mark Johnson, the former head of global FX cash trading at HSBC in London, has been sentenced to two years in prison following his conviction for eight counts of wire fraud and one conspiracy charge by a US court in October last year. Johnson was also fined $300,000.
Profit & Loss has reported extensively on the case, and just pulling out a few of the headlines provides a fairly decent timeline for how the case has developed since Johnson was arrested in New York almost two years ago.
Just a few days after his former manager Mark Johnson was found guilty of wire fraud by a New York jury, HSBC’s former head of European FX trading, Stuart Scott, has failed in his efforts to block his extradition to the US to face similar charges.
Scott was charged by the US Justice Department, along with Johnson, of conspiring to defraud Cairn Energy with regard to a large sterling buy order for the firm in December 2011. Scott continues to deny he did anything wrong.