LONDON - British regulators are preparing to bring criminal charges against Julian Rifat, a former trader arrested nearly four years ago in what was then described as the largest crackdown on insider trading here, according to a person familiar with the matter.
Mr. Rifat’s lawyers were informed this week that the Financial Conduct Authority is planning to bring criminal charges against him, the person said. Those charges are expected to be announced publicly in the coming weeks, said the person, who wasn’t authorized to speak publicly.
Mr. Rifat, a former trader at the hedge fund Moore Capital Management, was among those arrested in a series of raids by the British authorities in March 2010 in an investigation called Operation Tabernula. He has denied wrongdoing.
His lawyers have been pressuring the British authorities to unfreeze his assets and had been expected to appear in court in London on Friday to argue their case, but that hearing was canceled as a result of the pending criminal charges.
News of the pending charges against Mr. Rifat comes as British authorities have faced criticism over their ability to bring criminal insider trading cases, known as insider dealing here.
Late last year, the Financial Conduct Authority quietly dropped its investigation of two executives at the hedge fund Lodestone Natural Resources and a trader at another firm.
The men were arrested last February and the hedge fund was forced to liquidate, but the investigation resulted in no fines or charges of criminal wrongdoing.
The Financial Conduct Authority, created after the Financial Services Authority was split into two regulators last April, has defended its ability and the ability of its predecessor to bring such cases, saying the investigations are complex and can take time to build.
In a news release last month, the agency noted that the British regulator and its predecessor had secured 23 convictions for insider dealing since March 2009.
Prosecutors in the United States have built an impressive string of convictions in recent years using cooperating witnesses and wiretaps. In defending their use of the secret recordings, federal prosecutors in Manhattan have said that insider trading is a particularly difficult crime to uncover.
The United States Attorney’s office in Manhattan has secured 77 insider trading convictions or guilty pleas since 2009.
In the Operation Tabernula investigation, eight people have been charged in Britain, but the inquiry has resulted in only one conviction so far.
Paul Milsom, a former senior trader at Legal & General, pleaded guilty to insider dealing and was sentenced in March to two years in prison.
A 10th man, Clive Roberts, a former trader, was arrested at the same time as Mr. Rifat, but hasn’t been charged.
Moore Capital has said that the investigation did not involve any of its own funds and that it was cooperating with authorities. The company has described Mr. Rifat as an “execution trader,†meaning he did not make investment decisions.
