Mark Lyttleton, a former BlackRock managing director and portfolio manager, has been arrested as part of an insider-trading probe by the U.K. Financial Conduct Authority, two people familiar with the matter said.
Mr. Lyttleton was detained April 30 along with an unidentified woman in west London, said one of the people, both of whom declined to be identified because the matter isn't public. An FCA spokesman declined to comment on the investigation. Mr. Lyttleton couldn't be reached for comment.
The FCA said in a May 3 statement that a 41-year-old man and a 37-year-old woman were arrested when the London police executed a search warrant. The U.K.'s financial watchdog is seeking to crack down on insider trading by employees at London financial companies after having previously targeted lower-profile individuals. The watchdog is currently prosecuting seven other people for insider dealing, which carries a maximum sentence of seven years in prison upon conviction.
“The FCA has informed us that the allegations relate to actions carried out for personal gain, while off our premises, and that neither BlackRock, nor any other employee, is under investigation,” Brian Beades, a spokesman for BlackRock, said in an e-mailed statement. The firm is cooperating in the investigation, Mr. Beades said.
The FCA on April 1 took over the market abuse and consumer finance enforcement duties from the Financial Services Authority, which was phased out by lawmakers who blamed it for failing to prevent the financial crisis in 2008. Sky News reported the arrest Monday.
Mr. Lyttleton, who was based in BlackRock's London office, ran funds including BlackRock U.K. Dynamic Fund, with £558 million ($855 million) in assets under management, and BlackRock U.K. Absolute Alpha Fund, with £383 million in AUM, until March. He left BlackRock on March 28, according to one of the people.