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FCA slaps GBP 1 mln fine on Interactive Brokers UK

 UK’s financial services regulator, the Financial Conduct Authority (FCA), has fined the UK branch of the US brokerage Interactive Brokers (IBUK) GBP 1,049,412, the watchdog said.

 

The reason for the punishment are failings in IBUK’s post-trade systems and controls for identifying and reporting suspicious transactions in the period February 2014 to February 2015.

 

IBUK is based in London and executes and arranges transactions in various financial instruments, including CFDs directly for its UK clients and for other clients across the Interactive Brokers group of companies. Part of the activities, the post-trade monitoring in particular, was delegated to a team of IB employees in the US. However, the FCA found that IBUK has failed to adequately calibrate and test the post-trade monitoring systems to ensure potential market fraud by clients would be captured. Besides, IBUK did not provide oversight and quality control of the activities of the US team, did not monitor their reports and did not provide adequate training for the employees conducting the post-trade monitoring.

 

Consequently, IBUK failed to report to the FCA suspicious trading activity and the watchdog has established there were at least three occasions of market abuse in the relevant period.

 

Firms not only have a key responsibility to report suspicious conduct in our capital markets, they also have an obligation to ensure their trading systems are not used for the purpose of financial crime. IBUK’s systems were inadequate and ineffective in the face of potentially suspicious transactions; they fell below the appropriate standards and exposed counterparties and the market to risks they did not bargain for. The FCA will continue to enforce appropriate standards of market conduct to ensure our markets function well”, said Mark Steward, Director of Enforcement and Market Oversight at the FCA.

 

The FCA has a reputation of a strict regulator with high requirements and usually the forex brokers under its oversight are considered safe and reliable.


US company Interactive Brokers is a broker and market maker. It provides direct market access to over 120 market destinations and associated clearing and custodial services. The company has offices in the North America, Europe, Australia, and Asia and licenses from the relevant authorities in the US and the UK. 

 

   

TAGS: fca  uk  interactive brokers  fine 

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