CITY SLICKERS FOUND GUILTY

7 Dec 2005 05:15 PM

Two of the three men accused of using the Daily Mirror 'City Slickers' column to inflate share prices have been found guilty today at Southwark Crown Court, following a DTI prosecution. A third pleaded guilty at an earlier hearing.

The jury found that former Daily Mirror financial journalist James Hipwell and private investor Terry Shepherd conspired together with Anil Bhoyrul a former Daily Mirror financial journalist to use the City Slickers column to boost the value of their investments between August 1999 and February 2000.

Competition Minister Gerry Sutcliffe said:
"Today's verdict should send out a clear message that the Government will take action against those who break the law for their own financial gain. The DTI is committed to establishing and maintaining fair markets."

Terry Shepherd, a former day-trader who was in regular contact with Hipwell and Bhoyrul benefited from the 'tips' they featured in the column. He encouraged and assisted their activities by publishing advance notice of the tips on internet bulletin boards and, in the latter days, contributed ideas for tips.

Anil Bhoyrul pleaded guilty to the conspiracy on 11 August 2005, but Court restrictions prevented that plea being reported until today. Hipwell and Shepherd denied the charges against them.

The investigation began in January 2000 when the London Stock Exchange alerted the DTI's Companies Investigation Branch to a 'very significant rise' in the shares of Viglen Technology plc. The Secretary of State duly appointed inspectors to ascertain whether there may have been a contravention of the insider dealing legislation.

As a result of their findings, a criminal investigation was undertaken by Investigation Officers of the DTI Investigation Officers Section. They discovered a pattern of "purchase, tip and sale" of shares and evidence of an agreement between the Bhoyrul, Hipwell and Shepherd to use the City Slickers column to manipulate the market.

Between August 1999 and February 2000, James Hipwell made more than £40,000, Anil Bhoyrul around £14,000 and Terry Shepherd made around £17,000.

Sentencing will take place after the 17th January.

Notes to editors

1. Anil Bhoyrul, James Hipwell and Terrence Shepherd were charged with conspiracy to contravene section 47(2) of the Financial Services Act 1986 contrary to section 1(1) of the Criminal Law Act 1977.

2. The maximum sentence in the Crown Court is seven years imprisonment and/or an unlimited fine.

3. The DTI will not bring a similar case in future because the offence contrary to s. 47 of the Financial Services Act 1986 has been repealed and replaced by s. 397 of the Financial Services and Markets Act 2000. That Act also refers enforcement of the offence to the Financial Services Authority.

4. Reporting the guilty plea of Anil Bhoyrul was not allowed in order to prevent prejudice to the trial of Hipwell and Shepherd.

Chronology of events
January 2000 Daily Mirror's 'City Slickers' column Viglen shares tipped (18/01/00)

January 2000 London Stock Exchange reports very significant rise of Viglen Technology plc to the DTI

January 2000 Secretary of State appoints Company Investigations Branch to investigate insider dealing and DTI lawyers prepare for prosecution.

February 2002 - June 2004 Criminal investigation into five suspects for insider dealing

June 2004 - Criminal proceedings commence against Bhoyrul, Hipwell and Shepherd for the offence on the indictment.

23 August 2004 - The three defendants were summonsed to appear before Thames Magistrates' Court. The defendants were sent to Southwark Crown Court for trial.

20 September 2004 - First administrative hearing at Southwark Crown Court.

18 and 22 April 2005 - Application to dismiss the charge at the Royal Courts of Justice.

The applications were unsuccessful and on 29 April 2005, all three defendants were arraigned and pleaded not guilty. A number of directions were given preparatory to the trial which was set for 17 October 2005.

11 August 2005 - Bhoyrul changed his plea to guilty.

11 and 14 October 2005 - further arguments to dismiss the case. These were unsuccessful

17 October 2005 - trial started

07 December 2005 - Guilty Verdict