By Melvyn Howe, PA Former City Slickers James Hipwell and Anil
Bhoyrul are facing jail after pocketing more than £50,000 from share
tips published when they were working for the Daily Mirror.
Hipwell and Bhoyrul used a “buy, tip and sell” technique to “cynically manipulate” the market and send stock values soaring.
As
the money continued to roll in, they recruited day trader Terry
Shepherd to the lucrative swindle, London’s Southwark Crown Court was
told.
The pair were subsequently fired from the Mirror, then edited by Piers Morgan.
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Hipwell
made £41,000 from the scam, and Shepherd was left £17,000 richer. On
Wednesday they were unanimously convicted of conspiring to breach the
Financial Services Act between 1 August 1999 and 29 February 2000.
Bhoyrul,
who currently edits a Dubai-based magazine, made £15,000 from the scam
and pleaded guilty to the same charge at an earlier hearing.
Adjourning
sentencing for all three to 10 January, Mr Justice Beatson warned
Hipwell and Shepherd that, while they could remain on bail until then,
“that does not mean I’m not considering a sentence of imprisonment”.
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The
seven-week trial heard the journalists repeatedly “ramped” shares with
the sole object of making money, and in the clear knowledge that what
they were doing was illegal.
“The conclusion is that the column was being used, at least partly, to manipulate the market so they could profit,”
said Philip Katz, QC, prosecuting.
The
court was told that four months after the journalists launched their
getrich- quick scheme, Shepherd contacted them through an online
bulletin board.
He acted as a go-between, receiving tips from the
two writers, and then leaking them to other investors over the
internet. But he later “stepped over the line into criminality” by
suggesting companies the journalists could plug.
One tip
triggered a probe by the Department of Trade and Industry. It concerned
Viglen, a computer company run by Sir Alan Sugar.
The article
appeared the day after the columnists and Shepherd bought shares, and
more than doubled the stock’s value. Morgan had also bought shares, the
court heard. Hipwell, Shepherd and Bhoyrul sold their holdings the same
morning, making a “very handsome” profit.
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