FSA bans ex-hedge fund boss Micalizzi

LONDON Tue May 29, 2012 7:15am EDT

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LONDON (Reuters) - The Financial Services Authority has banned ex-hedge fund boss Alberto Micalizzi for not being "fit and proper" and handed him a 3 million pound fine, its largest ever for an individual in a non-market abuse case.

The FSA said on Tuesday Micalizzi lied to investors to try and conceal "catastrophic losses" in 2008 of more than $390 million (242 million pounds), around 85 percent of the value in his London-based Dynamic Decisions Capital Management Ltd's DDCM.L master fund.

A Reuters investigation into Micalizzi's fund, DD Growth Premium, revealed in August that its main investment -- $500 million of highly illiquid bonds -- had been issued by a company in a trailer-park suburb of Phoenix, whose head was on the run from U.S. authorities.

The FSA said it has also canceled the permission of DDCM from conducting regulated business.

"Alberto Micalizzi's conduct fell woefully short of the standards that investors should expect and behaviour like his has no place in the financial services industry and we are committed to tackling it wherever we find it," Tracey McDermott, the FSA's acting director of enforcement and financial crime, said.

Micalizzi and DDCM have referred the case to the Upper Tribunal, the FSA also said in the statement.

(Reporting by Tommy Wilkes)

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