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

We heard evidence from the Traders, each of whom had provided witness statements and were cross-examined by Mr Shivji on behalf of the Authority and, in the case of Mr Urra, also by Mr Bailin on behalf of Mr Sheth. The latter cross-examination was confined to whether Mr Urra recalled either showing the Information Discovery Strategy to Mr Sheth and/or a subsequent discussion with Mr Sheth in relation to which Mr Sheth’s evidence was that he expressed his frustration that the strategy was not working.

In cross-examination Mr Shivji put the Authority’s case to each of the Traders, both in general terms by reference to the Authority’s allegations that their Trading Strategies were fabricated, and specifically by reference to some of the Instances and other trading activity to which the Traders had referred in their witness statements. The Tribunal does not at this stage set out its conclusions on the credibility of each of the Traders. They each denied market abuse, giving evidence that they had an intention to trade all of their Large Orders and did not collaborate to commit an abusive scheme. The Tribunal’s assessment of that evidence is made in the light of all of the evidence.

The Tribunal also heard evidence from Mr Fernando Fernandez-Maquieira, a broker in the EGB market, who had provided a witness statement and was cross-examined by Ms Hassell-Hart on behalf of the Authority. Mr Fernandez-Maquieira had worked with traders for 20 years and Mr Urra had been a client of his. He had first met Mr Urra whilst Mr Urra was at Credit Suisse, and Mr Urra remained a client during his time at MHI between 2012 and 2019. Mr Fernandez-Maquieira’s role was to help the traders find buyers and sellers for their orders. He gave evidence in relation to order size (both in the EGB futures market generally and sizes transacted by MHI), the splitting of orders and his opinion on the plausibility of Mr Urra’s Trading Strategy. The Tribunal accepts that Mr Fernandez-Maquieira gave his evidence honestly and sought to assist the Tribunal. However, the Tribunal has not relied on his evidence when making findings of fact as his evidence was given by reference to the long period of time during which he worked with Mr Urra and he was not able to be specific about order sizes by reference to particular periods of time as he no longer has access to the data relating to his transactions with MHI during the Relevant Period.

Mr Simon Virciglio, who is a former broker in the EGB market, had provided a witness statement in the context of Mr Urra’s reference and was willing to attend and be cross-examined but the Authority, Mr Lopez and Mr Sheth agreed he did not need to attend for cross-examination. Mr Virciglio’s evidence was essentially a character reference for Mr Urra, referring to him being held in high regard, straightforward, fair, meticulous and focused on his trading strategies. He also described both Mr Lopez and Mr Sheth as straightforward and honest. It was common ground between the parties that none of the Traders had previously been subject to any compliance investigation or disciplinary proceedings and, with no disrespect intended to Mr Virciglio, the Tribunal places no weight on his evidence.

The Tribunal also had the benefit of expert evidence from:

Mr Creaturo and Mr Kasapis both produced expert reports for the Tribunal and the Tribunal was also taken to the expert reports which Mr Kasapis had prepared before the RDC. Mr Creaturo and Mr Kasapis both addressed the matters identified in the agreed list of issues, namely:

The evidence in the hearing bundles included: