The Financial Conduct Authority (FCA) has fined BGC Brokers, GFI Brokers and GFI Securities – together BGC/GFI – £4.8m for market abuse failings.
According to the FCA, BGC/GFI failed to ensure that they had appropriate systems and controls in place to effectively detect market abuse.
BGC/GFI failed to properly implement the Market Abuse Regulation trade surveillance requirements. This meant there was an increased risk that potentially suspicious trading would go undetected.
BGC/GFI are inter-dealer brokers specialising in broking exchange listed and over-the-counter financial products and related derivative products. It is of fundamental importance to the integrity of the market that brokers such as BGC/GFI have effective market abuse surveillance systems in place.
During the period of July 2016 to January 2018, BGC/GFI had manual, automatic and communications surveillance processes that were deficient, and therefore, inadequate in properly addressing the risk of market abuse.
Additionally, BGC/GFI’s systems for monitoring market abuse did not have proper coverage of all asset classes which are subject to MAR.
FCA executive director of enforcement and market oversight Mark Steward said, “Oversight of our markets is a regulated partnership between the FCA and market participants and so gaps or holes in a firm’s ability to monitor and detect abusive trading poses direct risks to market integrity.
“This case is another example of the FCA’s determination to ensure firms prioritise market integrity and the maintenance of high standards of compliance.”
Since the fine, BGC/GFI have enhanced their systems and controls.
The FCA recently published a consultation on standards for operators of pension dashboards as well as setting out non-workplace pension requirements.
Copyright © 2022 RegTech Analyst
Copyright © 2018 RegTech Analyst
