The City of London was hit with allegations of a new insider dealing ring on Wednesday after investigators from the Financial Services Authority launched a series of co-ordinated raids on the homes and offices of three finance industry workers.
The unnamed men, all in their 30s, are employed in the City and have the FSA accreditation needed by finance professionals. That is likely to place the investigation among the more serious in a string of insider dealing inquiries launched by the City watchdog in recent years.
The identity of the company, or companies, for which the three work is not known but it is thought unlikely this will remain confidential for long.
A total of six searches in the City and Greater London area were carried out by the FSA in conjunction with Metropolitan police officers.
In a short statement, the FSA said: "No further details can be confirmed at this time and no individuals have been charged. The arrests are not linked to any other ongoing insider dealing investigation."
The three men at the centre of the investigation were arrested and held in custody before being questioned in relation to insider dealing and market abuse allegations. No charges have been brought.
Insider dealing is a criminal offence punishable by a fine or up to seven years in prison. The FSA has secured 21 convictions relating to insider dealing in the last four years. A further six individuals are currently being prosecuted.