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Friday, 27 July, 2001, 07:37 GMT 08:37 UK
City bans Archer son
Jeffrey Archer and James Archer
Lord Archer with his son James at the peer's recent court case
James Archer, the son of the disgraced peer Jeffrey Archer, and two of his former colleagues have been barred from working in London's financial centre.

Mr Archer was found guilty of manipulating the stock market by selling shares in a Swedish company to deliberately drive down the firm's share price in December 1998.


He also placed a substantial buy order with a Swedish broker so that he would trade artificially with himself and thus manipulate the price downwards

SFA
City regulator the Securities and Futures Authority (SFA) - a subsidiary of the Financial Services Authority - spent two years investigating Mr Archer and his co-workers at the investment bank Credit Suisse First Boston (CSFB).

The three men banned from the City were known as the "Flaming Ferraris" after their favourite drink.

The watchdog found that Mr Archer, David Crisanti and Adrian Ezra were not fit or proper persons to be members of the City's register of authorised dealers, and Mr Crisanti was also removed from the register of managers.

The expulsion of James Archer is the latest disgrace for his family. Last week his father was sent to jail for perjury and trying to pervert the course of justice.

Market manipulation

Mr Archer was found guilty of "trying to manipulate the closing price" of the Swedish Stock Exchange (SSE) and "trading directly on [its] computerised trading system without authorisation".

"All three individuals were found guilty of deceiving the SSE and CSFB's compliance department."


All three individuals were found guilty of deceiving the SSE and CSFB's compliance department

SFA
During the last few days of December 1998, the stock portfolio controlled by Mr Archer would have benefited by a sharp fall in the share price of Swedish wood pulp company Stora.

According to the City watchdog, Mr Archer "tried to manipulate the price downwards by aggressive selling".

"He also placed a substantial buy order with a Swedish broker so that he would trade artificially with himself and thus manipulate the price downwards."

To escape detection, "Mr Archer used a mobile phone to place the buy order".

Within minutes of James Archer's trading activities, Stora's share price plunged from 90 Swedish kronor to 60 kronor.

Confession

When the Swedish stock exchange investigated the deals, Mr Archer insisted he had traded with a real buyer.

After further inquiries by the SSE and CSFB in 1999, Mr Archer admitted that he had tried to manipulate Stora by trading with himself.


Rehabilitation is, of course, not ruled out, but would need to be demonstrated before individuals could again be entrusted with registered positions

SFA
Shortly afterwards CSFB dismissed Mr Archer, along with Mr Ezra and Mr Crisanti, who also admitted their part in the deception.

All three men were required to pay a contribution to SFA's costs. Mr Archer and Mr Ezra have each paid 50,000, while Mr Crisanti paid 100,000.

The regulator noted that Mr Archer and his former colleagues could re-join the City's register of authorised dealers.

"Rehabilitation is, of course, not ruled out, but would need to be demonstrated before individuals could again be entrusted with registered positions where customers and others rely on their integrity and professionalism," it said.

Although Archer and his colleagues had been acting on their own initiative their actions caused huge embarrassment to their employer.

Credit Suisse First Boston recently sacked its chief executive after a series of investigations, of improper behaviour during stock market flotations in the USA , and of market manipulation in Japan and India.

Flaming Ferraris

James Archer and his friends took the name "Flaming Ferraris" from the rum cocktail they adopted as their trademark drink as they grabbed the headlines on their regular spending sprees.

A Flaming Ferrari is a mixture of 100% proof rum, Grand Marnier and Green Chartreuse which is then set on fire and drunk through a straw.

The trio of traders all enjoyed huge bonus payments earned as a result of their spectacular successes in stock market dealing.

On Friday Lady Mary Archer refused to comment on the news about her son when she arrived at the start of the second day of a solar energy summer school she is attending in Glasgow.

James Archer's father, Lord Archer, was jailed earlier this month for four years after being found guilty of perjury and perverting the course of justice.

The jury found him guilty of lying and cheating in his 1987 libel case against the Daily Star.

 WATCH/LISTEN
 ON THIS STORY
The BBC's Rory Cellan Jones
"The affair has done nothing for the city's image"
See also:

05 Mar 99 | The Company File
Lord Archer's son is sacked
26 Feb 99 | The Company File
Lord Archer's son faces Swedish share probe
19 Jul 01 | UK
Archer jailed for perjury
25 Jul 01 | UK
Archer funds under scrutiny
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