UT (Tax & Chancery) UT-2022-000134 UT-2022-000135 UT-2022-000137 - [2025] UKUT 00214 (TCC)

Mr Kasapis is an experienced expert witness and is a Senior Director at Kroll Advisory (“Kroll”). Prior to joining Kroll in 2017 he had worked at Rabobank, KPMG and National Australia Bank, and had experience in a range of financial products. He has significant expertise in analysing trading data.

However, as Mr Kasapis acknowledged, he had no relevant trading experience himself, with no experience of market making in EGBs (or any bond market). Where he expressed his opinion by reference to his experience, the Tribunal was not satisfied that he had the requisite relevant experience, and certainly not such as would substantiate the opinions he expressed. By way of example:

Most of Mr Kasapis’s evidence was based on his analysis of the trading data. Mr Shivji criticised various aspects of Mr Kasapis’s approach, in particular the assumptions made in the context of his “Other Participant Trade Analysis” which Mr Shivji submitted were unrealistic and overstated the “immediate liquidity” at the time of the Large Orders, and the averaging approach used in the “Market Trend Analysis” which smoothed out price fluctuations.

The Tribunal considers that there were flaws in the approach adopted to analysing data (including rounding of time intervals where actual timings of traded volumes were available, and averaging of price movements) but nevertheless have found some of Mr Kasapis’s presentation of the data helpful. This included his identification (or confirmation of data which had been presented to him) of data relating to the trading activity in the Instances, in particular the Overlapping Small Orders and the amendments to Large Orders after the Small Order traded.

There were areas where Mr Shivji criticised the scope of the work which had been done by Mr Kasapis, submitting that he had gone beyond the role of an expert in producing a list of cash bond orders relating to Specified Instances for Mr Urra and Mr Sheth which had not been identified or relied upon by the Traders (and some of which were then denied or doubted by them). Whilst there was a clear error in this exercise, separate from whether the Traders agreed the cash transactions were relevant, in that Mr Kasapis had, for F67 (a Specified Instance for Mr Sheth) identified a cash bond trade with Banca Aletti without recognising that this was a split trade and thus failing to refer to the other leg of the trade in the other direction, the scope of the exercise undertaken was clear and we consider that Mr Kasapis was permitted to undertake this exercise; his report explained that this was his own identification of cash trades (in contrast to other sections where he set out that material had been provided to him and he had checked it and then put forward his opinions).

Mr Shivji was particularly critical of Mr Kasapis’s report where he produced graphs to show that two very large trades (of 7,540 lots and 3,242 lots) in 2017 had traded without there being an impact on the market to move the price towards the opposite side, submitting that he had sought to pass off material that had been given to him by his client (Mr Urra) as his own independent analysis and had not sought to verify the information given to him.

The Tribunal accepts that Mr Kasapis had not questioned or verified this information and did not in fact have the underlying data; and the Tribunal considered that the subsequent correspondence with the Authority following the Authority asking for the underlying data is unclear. However, the Tribunal does not accept that the presentation of this data in Mr Kasapis’s two reports to the Tribunal was misleading - there is no reference to the source of the data in those reports (whether Eurex or otherwise) and the footnote simply says “the data for which I was provided and assume to be accurate”; he does state that these examples had been produced in his first report. That is a reference to his report dated 12 November 2021 before the RDC, where (in section 4.3.5) he stated “I have been provided with…” without further explanation. This criticism as to the presentation of these trades is a separate issue from whether Mr Kasapis should then have addressed the possibility that these trades were block trades (reported after execution) or roll trades.