Boss sued after spread-bet backfires

A COMPANY director who lost almost £250,000 in disastrous stock market punts is being sued by a spread betting firm in a case that clearly highlights the risks of gambling on volatile shares.

Andrew Shortall placed a series of spread bets with Cantor Index on medical technology company Biocompatibles International. These amounted to punts of between £250 and £500 on every penny movement in the share price.

The bets, which began in February, could have made Shortall a fortune if shares had carried on rising towards 157p.

But on 7 March Biocompatibles stunned investors with news that human trials of a key drug in the US had flopped. Chief executive Crispin Simon said that some tests were likely to be abandoned. The shares duly nosedived from 147p to 74p.

Shortall, 46, of Bramhall, Cheshire, picked up the phone that afternoon and called Ian Jenkins, Cantor's head of sales in London. He told Jenkins to close his bets in an attempt to limit the damage. But this still left Shortall nursing huge losses. In all, Shortall lost £241,050 on his ill-fated stock market gambles.nOn one bet alone, placed on 22 February for Biocompatibles to reach 150p, Shortall lost £40,200.

Now Cantor is pursuing Shortall for the debts. According to a High Court writ filed this month, Cantor has already seized £73,641 that Shortall lodged in a personal account with the firm in July 2001, but is suing him for the £167,409 difference.

The spread betting firm claims it has written to Shortall demanding payment but he has 'failed and refused to pay'. Cantor is also seeking more than £5,500 in backdated interest on what Shortall owes, plus a further £55 for each extra day he delays payment.

Shortall, a director of A-Z Investments in Manchester, told Financial Mail that Cantor's claim 'will be vigorously defended and there will be a substantial counter-claim at a later stage' but he declined to elaborate. Cantor refused to comment.