The former treasurer and head of tax at supermarket giants Morrison has been jailed for insider trading by using privileged information on his employer’s online grocery deal with Ocado.
Paul Coyle, 50, was sent to prison for 12 months today after Leeds Crown Court heard he made £79,431 in profits buying and selling Ocado shares in early 2013 using the name and trading accounts of his partner.
During the three month period concerned Coyle, from Harrogate in North Yorkshire, was “at the heart” of the talks as Morrison negotiated with Ocado over the development of their online business.
Laura Mackinnon prosecuting said discussions included the acquisition of warehouse facilities, the finance structure and tax implications and he signed documents indicating he knew the restrictions imposed by his “insider” status.
Coyle, a former Inland Revenue inspector, initially bought 24,895 Ocado shares prior to 14 March, 2013 when an announcement was made the two were in discussion.
He sold them the day after the announcement making just over £8,000.
The father of four then continued to abuse his position by buying and selling a further 100,000 shares as the company share price fluctuated amid market speculation. During that period he sold some banking a further £11,000.
On May 17, 2013 after an official announcement was made that the two firms had reached a formal agreement he sold the rest of his shares making £60,000. His partner of 28 years Emma Baker said she had no idea he had used her name.
Jailing Coyle, Mr Justice Globe said while he accepted his remorse was genuine, his offending was so serious there had to be an immediate jail term.
“You came into possession of that information by your senior position within the organisation. Your breach of trust was significant.”
“Whatever your real motivation was, your actions were deliberate and in my judgment dishonest. You knew at the time what you were doing was illegal. Your actions continued over a three month period and involved a number of individual trades.”
The judge told him: “Insider dealing is not a victimless crime, harm has been caused by your actions, it has an impact on the overall public confidence in the integrity of the market.”
Coyle, of Warwick Crescent, Harrogate admitted two charges of insider dealing and was also ordered to pay £15,000 costs.
The judge ruled his benefit from crime was £203,234 made up of share value and profits and ruled he should pay that figure under a confiscation order within two months or face a further two and a half years in prison in default.
The court heard Coyle was a tax inspector with the Inland Revenue from 1988 to 1993, a tax advisor with a major firm of accountants from 1993 to 1998, in financial positions with various companies from 1998 to 2002 and head of tax with the RAC before joining Morrison in 2005.
Neil Hawes QC representing Coyle said he could not explain why he had done it and had not touched the money he had made. He and others had been under stress at Morrison which like many supermarkets had been under pressure with senior staff “fire-fighting” issues as they arose.
“He accepts he had a senior and important role at Morrison, he was in the confidence of senior management, privy to confidential material and trusted.”
He had now lost his employment and had not been working since.
Prior to that he was a man of impeccable character. He had continued to help at a local hospice in Harrogate but had resigned as chair of the financial committee and vice-chair of trustees after his arrest in 2013.
He urged the judge to suspend any prison sentence imposed.