MF Global Told to Pay U.K. Trader About $30 Million By James Lumley May 6 (Bloomberg) -- MF Global Ltd.âs London brokerage unit must pay a day trader about 20 million pounds ($30 million) in compensation for deceiving him about the amount of his trading losses, a London judge ruled today. Misrepresentations made by an MF Global account manager to former client Raj Gill led him to follow a flawed trading strategy that caused mistakes worth millions of pounds, Justice Julian Flaux ruled. âHad it not been for Mr. Gill being ensnared in the web of deceitâ he would have made money from his trades, Flaux said in his ruling. Gillâs company âis entitled to recover all its losses which flow directly from that fraud.â MF Global has more than tripled this year after Chief Executive Officer Bernard Dan paid down debt and bought back convertible notes. Dan said in a memo to staff that most of todayâs award will be covered by insurance. Gill had sought at least 9.3 million pounds over claims that in 2001 and 2002 an MF Global account manager, who has since left the firm, told him he was making trading gains when he was losing money. Gill claimed he would have changed his strategy if correct information had been provided. Instead, he wiped out a trading account with almost 10 million pounds. Eight Years Ago Diana DeSocio, a spokeswoman for Hamilton, Bermuda-based MF Global, said the company had a âstrong case for appeal,â as the damages awarded were disproportionate to Gillâs losses. âIt happened more than eight years ago,â DeSocio said in a telephone interview. âWe are now a different company under a different management structure.â âClaimants can hold the company to account and not just the trader who lied,â Tony Woodcock, a fraud lawyer at Stephenson Harwood in London said in a telephone interview. âAlthough insurance will pick up the tab, this shows MF in a very poor light, and they will have to work out a way to repair the damage.â Gill said in a statement heâs âhugely relievedâ the case is over. MFâs âcontinued protection of a liar for over seven years is indefensible, deplorable and deeply unethical.â Dan told staff about the courtâs decision in the memo and reminded them of the firmâs ethics policies. âSerious Reminderâ The case ârepresents something more than money -- it is the antithesis of the principles and policies that define our company,â Dan said in the memo, which was sent by the company to Bloomberg News. âThe verdict serves as a serious reminder that we have zero tolerance for any conduct that is not in the best interests of our clients.â Flaux worked out a schedule of profits that Gill might have made and said he would leave it to the two sides to agree the exact amount. The final figure, between 19 million and 20 million pounds, will be calculated at a later hearing. Flaux also said he may have to refer the case to U.K. prosecutors. MF on March 24 accepted allegations of fraudulent misrepresentation while denying liability. MF Global lawyer Michael Brindle told the court that while his client admitted that the account manager misled Gill, the misinformation didnât cause him to err. The case is: Parabola Investments Ltd. v Browallia Cal Ltd., No. 2006-855. To contact the reporter on this story: James Lumley in London at jlumley1@bloomberg.net. http://www.bloomberg.com/apps/news?pid=20601087&sid=a7_5LdaWYyig&refer=home