The UK Supreme Court has quashed the extradition to the US of a trader accused of insider trading in an unusual decision by British judges to curb the reach of American justice.
The UK’s highest court on Wednesday ruled in favour of Joseph El-Khouri, who US prosecutors claimed netted $2mn in profits from an insider trading conspiracy.
El-Khouri, a dual British and Lebanese national who lives in the UK, was charged in New York in 2019 and accused of obtaining inside information about prospective mergers and acquisitions of New York-listed companies.
The Manhattan US attorney’s office claimed he paid an intermediary for the information in cash and gifts including a yacht in Greece, a chalet in France and a hotel room in New York, and traded “contracts for difference” through a UK broker.
El-Khouri resisted extradition and accused the American authorities of over-reach, arguing that any links to the US were tenuous as the alleged misconduct took place in London.
A lower court had previously allowed his extradition after a hearing in 2021 and the UK government ordered that El-Khouri be sent to the US. An initial appeal by the trader at the High Court in London failed.
But a panel of five senior judges, led by the Supreme Court president Lord Robert Reed, on Wednesday unanimously ruled in his favour, blocking his removal on the grounds that the alleged criminality occurred outside the US.
The court noted that the UK’s Financial Conduct Authority conducted an investigation into El-Khouri between November 2016 and January 2018 but had concluded there was insufficient evidence to prosecute him.
El-Khouri’s lawyer, Richard Cannon of Stokoe Partnership Solicitors, said the ruling “brings to an end a five-and-a-half-year nightmare” that began with his arrest in 2019.
He added that the decision “represents an important check on over-reach” by the US authorities.
The US state department in London did not immediately respond to a request for comment.