MSN MoneyCentral – France’s stock market regulator has recommended imposing heavy fines on Deutsche Bank and GLG Partners, the leading London-based hedge fund, over their involvement in a 2002 issueof convertible bonds by Alcatel, the French telecommunications equipment group.
The Autorité des Marchés Financieres, which has been investigating the case for several years, has issued a report setting out its case. According to people familiar with its contents, it recommends that Deutsche should pay a €1.5m fine – the largest the AMF can impose – while GLG should be fined €1m.
The report concludes that three other hedge funds involved in the investigation – Marshall Wace, Ferox and Meditor – do not have a case to answer.
The proposed fines are the latest in a series of investigations by European regulators of behaviour by investment banks and hedge funds in the issue of convertible bonds.
This year the Financial Services Authority, the UK stock market watchdog, fined GLG and its former star trader, Philippe Jabre, £750,000 (€1.12m) each for their involvement in trading around a convertible bond issued by Sumitomo, the Japanese financial group.
