Market abuse broker back in business with new bank

Chris Potts, the first stockbroker to be fined for market abuse by the Financial Services Authority, is back running a fully authorised investment bank.

Potts was fined £75,000 and his then firm Evolution £500,000 in 2004 for short-selling 2.5 times the issued share capital of AIM-listed Room Service.

Potts began setting up XCAP, a market maker, corporate broker and corporate financier aimed at small-cap companies last year with Daron Lee, who used to work at the London Stock Exchange. The firm has now been authorised by the FSA which has approved Potts as "a controlling shareholder", but he remains a consultant and is not a director or authorised market maker.

He has raised £3 million from "wealthy individuals" and is planning to list the business on AIM later this year.

It has attracted 42 experienced City professionals mainly from Seymour Pierce, Savoy Asset Management and WH Ireland.