THE Financial Services Authority is considering publishing a report into the HBOS short-selling scandal, even though it may not find the culprits that caused the bank’s share price to plunge.
Shares in HBOS crumbled by 17% 11 days ago after e-mails were circulated round the City suggesting that the bank was facing a liquidity crisis. The rumours are thought to have emanated from the Far East.
The FSA is conducting an extensive inquiry and publication of the report would be unprecedented. It has already received material from compliance departments at several investment banks. It is also studying every short position in HBOS shares and asking the traders for explanations as to when and why they took the position.
The City regulator is aware that identifying those who perpetrated the rumours will be difficult, but by conducting a thorough investigation it will cause anxiety for those who profited from taking a position.
The FSA will also ask traders to explain their rationale for shorting HBOS shares.
The bank itself confirmed this week that there was truth behind some of the e-mails circulating in the City over the past fortnight
Quelle/ Source: FSA may go public over HBOS scam
© 2008 The Sunday Times