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Morrisons silent over ‘insider trading arrest’

Morrisons silent over ‘insider trading arrest’

Morrisons has refused to confirm or deny reports that its group treasurer Paul Coyle has been arrested on suspicion of insider dealing.

According to Foodmanufacture.co.uk, the supermarket has confirmed an arrest has been made but refused to release any further details.

The Financial Conduct Authority (FCA) has verified that an arrest was made in December in conjunction with North and West Yorkshire police.

A representative for the organisation said: “We arrested a 49-year-old man in Halifax in December, after searching premises in Harrogate.”

The search was in relation to insider dealing and market abuse allegations, according to the FCA.

Widespread media reports claim the arrest was connected to allegations that Mr Coyle - who is the head of tax at the supermarket - bought Ocado shares before its £216 million collaboration with Morrisons was officially announced.

After the deal was revealed, shares at Ocado rose by more than 250 per cent. Experts deemed that the online grocer had transformed its business prospects thanks to a 25 year partnership with the supermarket chain.

It is understood that Mr Coyle has yet to be charged with any offence, but he has not returned to work since his alleged arrest.

If convicted, the penalty for insider trading is a prison sentence of up to seven years and a substantial fine.

The news comes at a challenging time for Morrisons, as it recently reported that its like-for-like sales were down by 5.6 per cent for the six weeks to January 5th. The supermarket’s total sales fell by 1.9 per cent excluding fuel and 3.3 per cent when it was included.

City analysts Shore Capital described the results as “disastrous”, commenting: “Morrisons has surprised us with an especially disappointing trading update today (January 9th).”

Dalton Philips, chief executive officer of Morrisons, blamed the paltry results on discounting deals at rival supermarkets and the growing popularity of online shopping, which is a considerably weak area for the company as they have yet to provide a similar service.

He said: “However, we are firmly focused on driving our core business and accelerating our penetration of the fast-growing channels.”

 

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