Former Mizuho International Plc investment banker Thomas Ammann was sentenced to 32 months in prison for passing inside information about deals he was advising on to two women he was dating.
Ammann, a 39-year-old German national who worked on the Mizuho mergers and acquisitions team advising Canon Inc. (7751) on its takeover of OCE NV, must serve half of the sentence, Judge Anthony Leonard ruled today.
Jessica Mang and Christina Weckwerth were cleared of trading on illegal tips from him following a London trial that ended last month. Ammann pleaded guilty earlier this year to insider trading and encouraging the women to commit insider trading.
“It is clear that without your encouragement, neither of these women would have traded in OCE shares,” Leonard said. “You made use of that inside information deliberately and dishonestly.”
Mang and Weckwerth nearly doubled the amount they invested trading on the tip and then paid half their profits to Ammann, the U.K. Financial Services Authority said while prosecuting the case at a four-week trial. Ammann tried to avoid getting caught by having his girlfriends, who didn’t know the banker was involved with them both simultaneously, make the trades, the FSA said.
Canon, the Tokyo-based maker of cameras and photocopiers, agreed to buy OCE in a 730 million-euro ($954.6 million) deal in November 2009.
Weckwerth, who has British and Cypriot citizenship, took in nearly 2 million pounds ($3.23 million) after investing 1 million euros before the deal, prosecutors said. She argued she bought the shares only after doing her own research on Ammann’s recommendation, and that she didn’t know his work was related to the tips.
Mang, a British chiropractor who met Ammann at London nightclub Movida in 2009, said she bought the shares at Ammann’s request because she wanted to show she trusted him.
The banker exploited his privileged position “to make easy money,” FSA director of enforcement Tracey McDermott said in a statement. “Today’s sentence should serve as a clear warning of the consequences to anyone who might be tempted to follow Ammann’s example.”
Ammann was with a third woman when his house was raided in 2010, FSA lawyer Amanda Pinto said yesterday during a pre- sentencing hearing. The woman, who wasn’t identified, was Japanese and didn’t speak English.
The convicted banker also has a young son with a Chinese woman who has now left the country, leaving his elderly mother to care for the child, Ammann’s lawyer Adrian Darbishire said, asking the judge for leniency. Ammann also has debts of as much as $400,000 from bad property investments.
“He yielded to the temptation that was presented to him,” Darbishire said. “He has destroyed his good character, his career, his professional reputation, and any hope of working again in the” finance industry.
It emerged yesterday Ammann is facing separate charges related to the theft of food from Harrods, the luxury London department store owned by the Qatari sovereign-wealth fund. The judge referred to another prosecution, delayed because of the insider trading charges, over stolen cheese.
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