Watchdog sees big increase in dodgy deals

The Financial Services Authority received around 20 suspicious transaction reports a month in 2005, but this had grown to more than 50 a month by last year.

Overall, there were 115 reports in the second half of 2005, compared with 309 in the final six months of 2010.

The reports cover three main areas – namely the misuse of information, false or misleading information and distortion or manipulation of the market.

The vast majority of the reports fall under the misuse of information category, suggesting insider dealing.

But the regulator stressed that the figures did not necessarily reflect an increase in wrong-doing, but may simply be due to greater reporting levels by City institutions.

Lee Alam, manager within the FSA market monitoring team, said: “The biggest part of the increase is undoubtedly due to ongoing educational work.

“In addition, some of it is down to increased emphasis on case work. Firms are seeing the increased enforcement action we are taking and know we are achieving results on the back of their suspicious transaction reports.”