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An ex-Goldman Sachs analyst who obtained sensitive information about deals the investment bank was advising on and used it to trade stocks has been handed a prison sentence of almost two years.
Mohammed Zina was jailed on Friday after he was found guilty earlier this week of nine counts of insider trading and fraud by a jury at Southwark Crown Court.
Sentencing the 35-year-old to a 22-month term, Judge Tony Baumgartner said Zina’s crime had “struck at the heart of financial markets” and betrayed the trust of his employer.
Zina turned a profit of about £140,000 through insider trading in shares including of UK chip designer Arm and pub company Punch Taverns.
He took out loans with Tesco Bank, applying for them on the basis he wanted to finance home improvements, and used the funds in part to place 46 illegal trades through accounts set up in the name of his brother and sister.
Zina’s brother Suhail Zina, a former Clifford Chance lawyer, was charged alongside Mohammed and had also been on trial, but the judge directed the jury to acquit him before the end of proceedings.
Baumgartner said on Friday that he recognised Mohammed Zina — who was aged about 29 at the time of the offences — had a junior role at Goldman. He was otherwise of a good, “one might even say exemplary”, character.
The judge also took into account he had waited six years since his arrest for the verdict to be delivered, in part because of pandemic-related delays in the court system.
However, he found that Zina had engaged in “deliberate” misconduct that required “planning and sophistication”, and had only been stopped by his arrest.
He also told Zina he had “cloaked” his involvement by involving family members, unbeknown to them. The trades were placed via accounts held with Halifax Share Dealing, Hargreaves Lansdown and IG, and included shares in the US-listed consumer goods group Snyder’s-Lance and broadcaster HSN.
Lawyers for Zina, who worked in Goldman’s conflict resolution group, had argued during the trial he did not know he had inside information and questioned the reliability of prosecution witnesses.
The conviction is a win for the UK’s Financial Conduct Authority, which has faced some criticism for the pace of its enforcement on insider trading.
Nikhil Rathi, the head of the FCA, promised at the time of his appointment in 2020 that the regulator would act faster on enforcement cases.
However, in its review of the FCA’s work in December, the National Audit Office criticised the speed at which the regulator worked. It said “there can be a significant delay between the FCA identifying an issue and it taking action”.
The number of new enforcement actions opened by the FCA in 2022/3 was 158, up on 142 a year earlier, but lower than the 169 in 2020/21.
