Simon Brignall, who has admitted falsifying his trading figures for two years, has been banned from the City for life. The Toronto Dominion Bank, which employed him, was fined £490,000 for failing to spot the errors.

Mr Brignall, who left the bank in March this year, “had been attributing false values to his trading positions for almost two years”, the Financial Services Authority (FSA) said. Mr Brignall, who was a fixed income trader at the London branch of the bank, had also “entered a number of fictitious trades [into the bank’s systems] during the two weeks leading up to his resignation,” the FSA said.

He was banned from working in a “regulated activity” because the FSA said that he could no longer be considered a “fit and proper person”.

Although he is technically free to re-apply for FSA authorisation at any point, a spokeswoman for the regulator said that it was “not very common” for people in Mr Brignall’s position to be accepted.

TD Bank, whose fine was cut by 30 per cent for co-operating with the FSA, was criticised for failing to notice “either the extent of the mispricing of the trades or the fictitious trades".

The FSA said that the bank’s most serious breach was its absence of a system to verify trading prices. This meant that Mr Brignall was free to enter the value of his own trading positions into the bank’s accounting systems. These valuations were not subsequently checked by anyone else.

The FSA said that the Canadian bank lost a total of C$8.8 million (£4.4 million) from Mr Brignall’s activity, adding that he did not personally profit from the scheme.

Margaret Cole, the FSA's director of enforcement, said: "The level of penalty imposed on Toronto Dominion demonstrates that the FSA regards the implementation and maintenance of these proper systems as essential to maintaining confidence in the financial system.

"The FSA also expects approved persons to act properly to ensure that trading positions are valued accurately. Mr Brignall failed to observe proper standards of market conduct by mispricing his futures positions over a period of almost two years and entering false trades. In so doing, he concealed significant losses on his trading book. We regard this as a very serious breach of the standards of behaviour expected of approved persons."

The FSA acknowledged that TD Bank informed the FSA about Mr Brignall’s activity as soon as possible and that the bank had cooperated fully with its investigation.

The bank has also taken a number of steps to address the systems and controls failings, including ensuring that all valuations are now independently verified, the FSA added.

The regulator also said it recognised that Mr Brignall had admitted his actions and been candid in his dealings with the FSA.

At the time of the misconduct, Mr Brignall was under “significant pressure in his personal life”, the FSA added.

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