Two professional day traders have pleaded guilty to six instances of insider deal.

Matthew and Nikolas West pleaded guilty at Southwark Crown Court on Friday following a prosecution brought by the FCA. 

Between November 2016 and January 2020, Matthew West used confidential inside information to deal in shares in four companies: Proactis Holdings Plc, Palace Capital Plc, Concha Plc, and Bushveld Minerals Limited.

Matthew West, 44, also disclosed inside information to his brother Nikolas West. 46, in relation to a fifth company, Asimilar Group Plc. Nikolas West used this inside information to deal.

The total profits from the dealing were £42,948, the FCA said. 

Matthew West obtained the inside information from brokers who contacted him legitimately. He then disclosed and traded using this information, which is against the law. 

The pair admitted six instances of insider dealing and will be sentenced on 3 July at Southwark Crown Court.

According to the FCA, Matthew and Nikolas West worked as professional day traders using their own accounts and through companies controlled by them. They received inside information from brokers in the course of their work.

The FCA said that brokers can provide legitimate information via ‘wall crossing’. Wall crossing means providing non-public and price-sensitive information to a third party, and it is a legitimate practice in financial markets. However, when investors are ‘wall crossed’ there is a non-trading and confidentiality agreement in place.

The maximum sentences for these offences, which predate a sentencing change in November 2021, is a fine and/or up to 7 years’ imprisonment.

The FCA will also apply for confiscation orders in relation to proceeds of crime.

Steve Smart, joint executive director of enforcement and market oversight at the FCA, said: “Matthew West repeatedly tried to make a quick profit at the expense of the rest of the market. As professional investors, the West brothers clearly knew what they were doing was wrong.

“Fighting financial crime is a priority for the FCA. We will clamp down hard on those like the Wests who undermine the integrity of UK markets.”