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A Financial Conduct Authority executive said the U.K. regulator is investigating fraud in the demise of a listed company and whether two directors in another listed firm falsified revenue and profits.

Executive Director of Enforcement and Market Oversight Mark Steward said in the first case the FCA suspects that assets were stripped from the company “while its controllers fed the market with false and misleading information to boost the share price.”

In the second case, the regulator is “looking at action against two directors of another failed listed company whom we allege orchestrated a complex fraud to falsify the firm’s revenue and profits and to mislead the market,” Steward said, according to a copy of a speech to a securities regulation conference in London posted Friday on the FCA website. He didn’t identify the companies.

“These are cases not many other regulators or law enforcement agencies chose to take on but we must if we want to ensure our approach to market abuse is not unduly narrow or limited and that we are prepared to tackle the hardest cases,” Steward said.

Steward was laying out the FCA’s broad strategy to crack down on market abuse. In the past two years, the regulator has imposed several fines on financial institutions, particularly for their failure to comply with their reporting obligations. It had built up a credible track record of insider-trading prosecutions, though it hasn’t got a new trial for the misconduct on the horizon.

An indicator known as the Market Cleanliness metric showed a drop in unusual trading ahead of merger and acquisition news to 10% in 2018 from 30% a decade earlier, Steward said, adding that he attributed this in part to an “increase in enforcement.”

To contact the reporter on this story: Franz Wild in London at fwild@bloomberg.net

To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Christopher Elser, Peter Chapman

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