A solicitor jailed after the Financial Services Authority’s first criminal prosecution for insider dealing lost his appeal against sentence last week.

Christopher McQuoid, 40, former general counsel at TTP Communications, and his father-in-law, James Melbourne, 74, were both found guilty of one count of insider dealing and sentenced to eight months in prison, with Melbourne’s sentence suspended for 12 months.

McQuoid’s grounds for appeal included that there was no rational basis for the FSA singling out his case to send a warning to the industry by prosecuting, rather than taking regulatory action leading to a fine.

The Court of Appeal, led by the lord chief justice Lord Judge, dismissed the appeal, holding that immediate imprisonment was appropriate and the sentence as merciful as possible. Giving guidance on sentencing, the court said that insider dealing was a species of fraud and cheating, and not a victimless crime, making prosecution in open court appropriate.

Margaret Cole, the FSA’s director of enforcement, welcomed the verdict. ‘The lord chief justice’s comments support our tougher approach in pursuing insider dealing through the courts as a criminal offence,’ she said. ‘Insider dealing is cheating and damaging to the integrity of our markets.’