R (The Financial Conduct Authority) v Abdel-Malek & Anor

In determining whether convictions are unsafe following alleged disclosure failures, an appellate court must assess the totality of the material now available. Further material will not render a conviction unsafe unless it materially alters the fairness or adequacy of the case presented to the jury.

Information received from alternative sources does not preclude proof that an accused also received and used inside information from the charged insider. Disclosure and cross-examination must be fair, but a trial judge may prevent speculative inquiries into unconnected trading and investigations that would distract the jury from the indicted conduct.

The appellants were convicted at a retrial in the Southwark Crown Court of ten offences of insider dealing under Criminal Justice Act 1993, section 52. The prosecution alleged that the first appellant, a UBS compliance officer, disclosed confidential price-sensitive information about five proposed corporate transactions to the second appellant, who traded in the target companies’ shares.

The first jury failed to reach verdicts. At the retrial, the jury returned 10–2 majority convictions on every count and each appellant received three years’ imprisonment. The appeals concerned disclosure, public interest immunity, limits on cross-examination of the officer in the case, fresh evidence, and a Watson direction. The central issue was whether later information suggesting that the second appellant’s associates might have had another source of inside information rendered the convictions unsafe.

1. The appeals were dismissed. The convictions were safe. The court assessed the fairness of the trial in the light of all material then available, including post-trial disclosure and the fresh evidence received on appeal.

2. The agreed facts at trial had already enabled the defence to contend that an associate might have had a source at Citigroup with access to price-sensitive information concerning all five transactions. Later disclosure identifying the alleged intermediary and possible source added detail but did not materially improve that defence or reveal a new one. It remained no more than a possibility that the source had obtained relevant information, which was consistent with the agreed facts.

3. It did not follow that the second appellant could not have received information from the first appellant merely because he might also have received information from associates. If the jury was sure that he knowingly received and used inside information disclosed by the first appellant, both were guilty whether or not he also had other sources.

4. The trial judge’s disclosure rulings and refusal to permit cross-examination into broad, unconnected investigations of others were proper case-management decisions. Such inquiries were speculative, disproportionate and liable to divert the jury from the five charged transactions. The court’s own review of the public interest immunity material justified no further disclosure.

5. The court received evidence about Citigroup’s records and the possible source, but it located no document showing that the possible source had accessed price-sensitive information for the indictment transactions. It rejected speculative expert conclusions to the contrary. The Watson direction was within the judge’s discretion, and leave to adduce unrelated United States evidence was refused. The appellants were required to surrender to serve the balance of their sentences.

• Court of Appeal (Criminal Division) Dismissed the appellants’ conviction appeals and upheld the convictions: [2020] EWCA Crim 1730.
• Southwark Crown Court At a retrial in June 2019, the jury convicted both appellants by 10–2 majorities on ten insider-dealing counts. Each received three years’ imprisonment. The first trial had ended when the jury could not agree on verdicts.