The Financial Services Authority’s (FSA) long-awaited crackdown on insider dealing hit another procedural hiccup yesterday when the case against Malcolm Calvert, a former partner at Cazenove, the Queen’s stockbroker, was put on hold.

Lawyers for Mr Calvert, who has pleaded not guilty to 12 counts of insider dealing, persuaded City of Westminster Magistrates Court that the case should be postponed until a separate but connected legal challenge has been decided.

The issue, which was raised last week in the case of a father and son accused of insider dealing, concerns whether the FSA has the authority to launch prosecutions on its own without the consent of the Director of Public Prosecutions or Secretary of State.

Last week lawyers for Neel and Mathew Uberoi, who are each charged with 17 counts of insider dealing, told a court that their case should be thrown out because the FSA did not follow the correct procedure and obtain external consent.

A judge is due to give his ruling on the issue next week.

The FSA said it believes it has followed correct procedure in both cases and that it will appeal if necessary.

The regulator added that a third insider dealing prosecution, against the former general counsel of TTP Communications, would not be affected by the consent issue because it was already at a more advanced stage.

However, lawyers familiar with the issue said that what stage a prosecution had reached was irrelevant and that if the FSA loses on this issue all three of its insider dealing cases could be compromised.

The three cases, none of which have reached trial, are the first the FSA has launched and are at the centre of a renewed crackdown on insider dealing, a criminal offence that carries a maximum seven year jail term.

Other lawyers played down the significance of the consent issue, saying it was nothing more than a procedural hiccup that posed no real threat to the prosecutions.

The Uberois, who have not entered a plea, declined to comment.

Mr Calvert declined to comment. His alleged insider dealing took place after he left Cazenove, which is now in a joint venture with JP Morgan, the US investment bank.

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