BRITAIN'S pounds 60bn investment trust industry yesterday began to crack under the strain of hostile corporate activity as a leading Barings trust said it would grant some of the wishes of shareholders who want to break it up. Other likely topics for discussion include Liffe's ownership structure. Mr Hodson has hinted it could incorporate and float on the stock market.Separately, Liffe announced yesterday that Datastream/ICV and Reuters would sell and support a Liffe-developed software package which provides access to Liffe Connect, the exchange's new electronic platform for trading individual equity options.. Members are expected to rubber-stamp plans to introduce electronic trading and will also discuss Liffe's controversial scheme to relocate at Spitalfields in East London. "The DTB system does not have the superior functionality we require," remarked Jack Wrigglesworth, Liffe's chairman.The recent decision of two rival exchanges to merge has simply heaped more pressure on Liffe's shoulders. Last month, Liffe's share of the 10-year Bund futures market sank to 39 per cent, down from 70 per cent a year ago.The exchange's rivals added insult to injury earlier this week when the Deutsche Borse took out full-page adverts in a number of UK national newspapers, offering to install DTB's electronic system at Liffe for free.Liffe was not amused. Large players appear to be increasingly disaffected with the exchange - both Lloyds TSB and Nikko, the Japanese bank, have scaled down their presence.Especially galling for Liffe has been the success of DTB in trading the prestigious German bond (Bund) contract.

The exchange also said it would cut transaction fees - the details of which were announced yesterday.Liffe has lost market share to electronic exchanges recently, particularly DTB. The key proposal was the decision to develop an electronic trading system by the end of next year which will operate alongside its traditional "open outcry" system. Previously, the rate for financial futures was 42p and for financial options 27p.The move is part of a concerted campaign by the exchange to reassert itself in the competitive European market.Two weeks ago, Liffe announced the main results of a wide-ranging review of its strategic direction. Liffe is to cut its transaction fees on its financial futures and options products, in an attempt to encourage "additional usage" of Liffe's products, according to Daniel Hodson, the exchange's chief executive.

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From 1 April, the transaction charges for all financial futures and options contracts - excluding the Euroyen futures contract - will be reduced to 25p per lot per side.

THE LONDON International Financial Futures and Options Exchange (Liffe) has sparked off another round in "the battle of the exchanges" by cutting its prices in a move designed to claw back market share from arch-rival DTB, the electronic exchange based in Frankfurt. There's no room for more leniency."Sumitomo said it had tightened supervision of its traders since the fraud was discovered in June, 1996, as US and British authorities investigated manipulation of the copper market.Kenji Miyahara, Sumitomo president, said: "The company's internal controls have always been consistent with industry standards. Nevertheless, after discovering Mr Hamanaka's unauthorised activities, we evaluated our internal control system and employed new measures."From 1985 until his exposure in 1996, Hamanaka bought copper in such copious quantities that he single-handedly kept prices rising in order to forestall losses on all the copper he had already amassed.That infuriated traders who had bet the other way and generated rumours for years that he and Sumitomo were manipulating the market.In a hearing last year, Hamanaka pleaded guilty to fraud and forgery, admitting he forged documents and stole 75.6 billion yen (pounds 355m) from one of the company's Hong Kong units to cover up the decade of unauthorised trades.. The judge cut that by two years since it was Hamanaka's first offence. "Hamanaka's actions greatly shook Sumitomo's corporate foundation," said Judge Yoshifumi Asayama "He caused turmoil in the international copper market. Price Waterhouse has been hired to review the work undertaken by KPMG..

THE FORMER chief copper trader at Sumitomo has been sentenced to eight years in prison after pleading guilty to hiding $2.6bn (pounds 1.6bn) in trading losses, the largest financial disaster ever blamed on a single trader. Yasuo Hamanaka, 50, lied and forged documents as his losses snowballed while he bought 1 million tons of copper over a decade in a desperate attempt to keep prices up. Hamanaka bought so much copper - as much as 5 per cent of all that metal traded in the world each year - that traders dubbed him Mr Copper. His lawyers said he would appeal, and he remains out on bail Prosecutors had asked for a 10-year sentence. Yesterday the share price surged 40.5p to 136.5p following the announcement.Colin Fell, an analyst with Dresdner Kleinwort Benson, said: "The fact that somebody could have sat in on a meeting doesn't mean that he knew they were going to lose pounds 46m. Shay McKeown stepped down from his chief executive post yesterday but will remain as a consultant, and Barry Cosgrove, finance director, resigned immediately. Powerscreen executives have withstood calls for their resignations since "irregularities" in the accounting books of their subsidiary Matbro were announced in January.