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Former Blackrock star portfolio manager Mark Lyttleton, 45, has been sentenced to 12 months in prison after pleading guilty to an "elaborate web of insider trading, using offshore companies, unregistered mobile phones and cash payments." Lyttleton was arrested at his west London home in 2013 as part of an investigation, known as Operation Rye, by the U.K. Financial Conduct Authority. The ex-portfolio manager, who was based in BlackRock’s London office, ran funds including the BlackRock U.K. Dynamic Fund and the BlackRock U.K. Absolute Alpha Fund, once overseeing as much as 2 billion pounds.
The ex-Blackrocker will now spend Christmas behind bars following his sentencing at Southwark Crown Court on Wednesday for insider trading that netted him £45,000 profit. He was also confiscated of £149,000.
Lyttleton previously pleaded guilty last month to two counts of insider trading. As the FT adds, he admitted using inside information to trade in the securities of Encore Oil and Cairn Energy in a case brought by the City watchdog, the Financial Conduct Authority. Both those companies were on BlackRock’s list of stocks about which employees had received inside information, the FCA said. Lyttleton’s lawyer Paddy Gibbs said he gleaned the information through overhearing colleagues’ remarks.
Gibbs added that his client had not created the offshore structures purposefully for insider trading but rather that his French wife and he were planning on moving abroad, and that the structures existed long before the offences. Lyttleton used the structures and pay-as-you-go mobile phones and cash payments at the suggestion of his Swiss-based adviser, Philip Caldwell, the court heard.
BlackRock has previously said that the offences were committed for Lyttleton’s personal gain off the premises and that there was no impact to any client.
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