FCA Fines Oil Consultant £309,843 for Insider Dealing Using Drilling Information

The Financial Conduct Authority (FCA) has fined oil and gas consultant Russel Gerrity £309,843 for insider dealing after he used confidential drilling information to generate personal trading profits of £128,765. The enforcement action highlights the FCA’s continued focus on market abuse and the critical role of surveillance and industry reporting in detecting misconduct.

Between October 2018 and January 2022, Mr Gerrity exploited inside information obtained through his consultancy role, which gave him early visibility of whether oil and gas had been discovered during drilling operations. Armed with this non-public information, he purchased shares in Chariot Oil and Gas Limited and Eco (Atlantic) Oil and Gas Plc ahead of market announcements that subsequently drove share price increases.

In addition to profiting from positive discoveries, Mr Gerrity also used inside information to avoid losses. On one occasion, he sold shares in advance of an announcement confirming that no oil or gas had been found, thereby sidestepping the share price fall that followed. This behaviour demonstrated a sustained and deliberate misuse of privileged information rather than an isolated lapse in judgement.

The FCA’s investigation was initially triggered by Suspicious Transaction and Order Reports (STORs) submitted by a firm, underlining the importance of STORs as a frontline defence against market abuse. The regulator’s own market surveillance systems later identified further suspicious trades across multiple brokerage accounts, including trading activity conducted while Mr Gerrity was based outside the UK.

The misconduct breached Article 14(a) of the UK Market Abuse Regulation, which prohibits insider dealing. Mr Gerrity agreed to settle the matter and received a 30 percent stage one settlement discount. Without this reduction, the financial penalty would have been £387,448.

Commenting on the case, Steve Smart, executive director of enforcement and market oversight at the FCA, stated that the regulator would continue to take action against individuals who undermine market integrity and seek to recover ill-gotten gains. The case aligns with the FCA’s five-year strategy, which places tackling financial crime and market abuse at the centre of its supervisory and enforcement priorities.

This enforcement outcome serves as a reminder that consultants and contractors are subject to the same market abuse rules as permanent insiders, and that cross-border activity and the use of multiple accounts do not shield individuals from detection or regulatory action.

Read the press release here.