The U.K. Financial Services Authority has finally won its first convictions for insider dealing, nine years after the government gave it the powers to prosecute such cases.

A jury found that Christopher McQuoid, the general counsel of a listed technology company, had tipped off James Melbourne, his father-in-law, about a looming takeover bid. Melbourne traded on the information and the two split the profits.

The pair were each sentenced to eight months in prison, with Melbourne’s sentence suspended for 12 months.

The victory comes at an important time for the regulator. Its chief executive, Hector Sants, recently said that the financial industry should be more frightened of the FSA as it planned to get tougher on compliance and enforcement.

McQuoid and Melbourne are hardly the kind of City of London high-fliers that the FSA suspects are responsible for most insider dealing. But within days of their conviction the regulator announced the arrest of two people in connection with what it said was an ongoing investigation into “organized insider dealing.” The regulator described one of them as “a senior corporate finance adviser.”

Commenting on the sentences for McQuoid and Melbourne, Margaret Cole, director of enforcement at the FSA, said: “The FSA is getting tougher on insider dealing and will not hesitate to take action against people who damage the integrity of our markets.”

The Financial Services and Markets Act 2000 gave the FSA powers to investigate and prosecute insider dealing, which is defined by The Criminal Justice Act of 1993.

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