FCA hails Korfuzi siblings’ long insider dealing sentences

The UK Financial Conduct Authority’s (FCA) chief criminal counsel hailed custodial sentences passed on Redinel and Oerta Korfuzi at Southwark Crown Court in London as the longest yet secured in the UK for insider dealing.

“When I joined the FCA, there was a legacy notion that we were something of a toothless regulator. Those days are long gone,” said Vincent Coughlin, KC, who has been at the FCA since 2017.

Redinel, a former Janus Henderson analyst, was sentenced to six years for insider dealing, while his sister, Oerta, was given five years. They received additional six- and five-year sentences respectively to be served concurrently for laundering the proceeds of their crime.

“Significant win”

Coughlin called the verdict a “significant win” for the regulator, in an investigation that was brought “at pace”. “These cases are hard to prove but market abuse is part of our core business and we get the job done,” he wrote on LinkedIn.

The previous record for an insider dealing sentence was imposed back in 2019 on Richard Baldwin, who jumped bail during his trial in 2017 and was sentenced to five years and eight months in absentia. He remains at large.

Disregard for compliance

In his second year as a Janus Henderson analyst, Redinel Korfuzi earned £539,444 plus a share award of $80,000. He should have been in no doubt about the policies and procedures governing inside information and personal account dealing, the court heard on July 4.

“During your evidence, you told the jury that you regarded the regular compliance checks required by your employer as being of secondary importance and your declarations of compliance as being merely a bureaucratic box-ticking exercise,” said His Honour Judge Milne, KC in his sentencing remarks.

“This casual and dismissive attitude to the rules was perhaps indicative of a more serious underlying problem,” he added.

Wall crossing scheme

The siblings took advantage of Redinel’s role dealing with approaches from banks on behalf of publicly quoted companies seeking to issue additional shares or release parcels of existing shares on the market. This information is deemed to be insider information and subject to trading restrictions.

Redinel was in receipt of “wall crossed” or inside information involving 45 companies between December 2019 and March 2021. His sister traded on the information through various accounts during these periods.

The pair were sentenced based on 13 trades, which demonstrate the conspiracy as indicted, the judge said.

Both Redinel and Oerta were deliberately dishonest, the court heard.  

“The scheme was, in my view, sophisticated, prolonged and repeated using a range of accounts and deliberately spreading trades across trading accounts to minimise attention on any one account; it was a joint endeavour between the two, designed to ensure that Redinel’s name did not feature in the actual trades,” the judge said.

Laundering

The Korfuzi siblings laundered their profits — some £973,115.93 — partly by paying £198,210 in cash into eight different UK bank accounts.

“So much cash was collected that a safe deposit box was commissioned in the West End of London to store it. Sums were remitted to different Albanian bank accounts, and significant amounts were passed into UK-based trading accounts, enabling positions to be taken on stocks and acting as a further laundering process,” the judge said.  

At the time of the Korfuzis’ arrests in 2021, nearly £25,000 in cash remained — a significant portion of it in Scottish and Northern Irish banknotes. Earlier, around £40,000, also largely in non-Bank of England notes, had been deposited into accounts linked to the Korfuzis’ associates, who were not charged in connection with the insider trading case. In total, over £263,000 in cash was identified, the court heard.

The siblings may face deportation upon their release from jail, the judge said.