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The SFC's disciplinary action followed administrative proceedings against Aarons in South Korea. The Korean regulatory authorities found that Aarons had breached Korean legislation by dealing in the shares of a securities company listed on the Korea Exchange (KRX) based on material non-public information in circumstances that prohibited such dealing.

The information concerned a block trade of shares of the KRX-listed securities company which Aarons had obtained from a sell-side broker during a "market sounding" call in January 2016 that preceded the public announcement of the block trade.

It was determined in the Korean proceedings that although the name of the securities company was not mentioned during the call with the broker concerned, there was nevertheless sufficient particularity in the information that was imparted to enable Aarons to satisfy himself that the information must relate to the company.

Aarons was not wall-crossed during the call with the broker, but he cut short the call with the broker and arranged short swaps in the company's shares about 20 to 25 minutes after he had obtained the information from the broker.

The SFC found that Aarons' conduct was such that he was not a fit and proper person to continue to be licensed as a representative or to remain as an RO of Trafalgar, having regard to General Principles 1 and 7 of the Code of Conduct.

The SFAT also upheld the SFC's decision to suspend Aarons' licence to act as a representative and his approval to act as an RO, but varied the period of the suspension from three years to two years.

Mr Ashley Alder, the SFC's Chief Executive Officer, said: "The SFAT's determination sends an unmistakable message to the market that both sell-side brokers and buy-side participants have obligations to uphold market integrity by maintaining the confidentiality of non-public information on block trades or private placements during the market sounding process. We would not tolerate misuse of such information and individuals who abuse the process warrant severe sanctions."

In the SFAT determination, Justice Hartmann said that, in the course of a conversation of the kind initiated by the broker, "a party being approached - a buy-side participant - has the obligation at all times to consider the nature of the material being imparted and whether the nature and extent of that information binds him or her to confidentiality."

"Put simply, a buy-side participant cannot take advantage of the delay or negligence of a sell-side broker by acting for purposes of gain on what he knows to be material non-public information received. Such conversations embody mutual good faith and adherence to fair conduct. If it was otherwise, the essential integrity of these important dealings would be undermined," Justice Hartmann added.