J.P. Morgan's Ian Hannam resigns, faces fines

April 3, 2012: 12:36 PM ET

Villagers of Qara Zaghan have been digging for gold for decades.

Ian Hannam has made a fortune for J.P. Morgan (JPM) as one of the oil, gas and mining industry's great deal makers. On Tuesday, the chairman of capital markets for J.P. Morgan Cazenove, the London branch of the bank, resigned his post to fight allegations of market abuse.

British regulators fined Hannam 450,000 British Pounds for two instances of improperly disclosing insider information about oil discoveries  in Kurdistan and Uganda.

Regulators from Britain's Financial Services Authority said in a statement that the size of the fine reflected the "serious nature of the market abuse" and Hannam's "serious error of judgment."  They also stated that  Hannam made no personal gain from the disclosures and that there is no evidence anyone traded on the information. "Mr. Hannam's honesty and integrity is not in question," the FSA's decision notice said.

Hannam is contesting the FSA's fine before the Upper Tribunal. He told regulators he had acted in good faith and in his client's interests. --James Bandler

Fortune editor-at-large James Bandler checked in with Hannam in May 2011 in a feature that examined the vast potential and risks of J.P. Morgan's venture into Afghanistan's mineral wealth.

J.P. Morgan's hunt for Afghan gold

A team of bankers starts to tap the country's vast mineral riches, with help from the Pentagon.

By James Bandler, editor-at-large

FORTUNE -- Qara Zaghan, Afghanistan: The four Black Hawk helicopters sweep down on this remote river valley, flying fast and single file. Snow covers the mountains' peaks, but the lower slopes look like rust -- dry, rocky, and bare. As we bank around the river bend, we see our first flash of green in the fields below and then the rectangular mud huts of the village, where hundreds of Afghans mass to greet us.

"That's the mine over there," one of my companions says, pointing to the cliffs rising above the village.

That's it? That's the gold mine? It doesn't look all that different from the forbidding country we've been traversing: just another pile of rocks and scree. The jet-lagged man in the seat across from me knows better. His sleepy eyes are suddenly alert. If anyone can wrest a fortune from Afghanistan's rubble, it is this man, Ian Hannam.

Arriving in a developing nation with his iPad and his enigmatic smile, Hannam personifies the soft side of Western power. He doesn't bend people to his will with weapons or threats. But there is no mistaking the dealmaker's impact: In his wake, mountains are razed, villages electrified, schools built, and fortunes made.

Read the rest here.

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