No market abuse sanctions by FCA in 2018

ESMA has published its peer review on how national competent authorities handle suspicious transactions and orders reports (STORs) under the Market Abuse Regulation. It is fully compliant in four of the ESMA metrics and broadly compliant in the other two.  So congratulations FCA – pretty much top of the league in this review.

However, what is interesting is that despite this near-perfect report card, the FCA has not imposed any measures and sanctions on firms.  Surely the true measurement has to be the number of successful market abuse cases the regulator has brought? The ESMA report has a handy table showing the number of measures and sanctions imposed for market abuse infringements and the UK figures for 2018 show no sanctions.

Without wanting to appear like the Christmas Grinch, in our view this is a very disappointing figure. Bearing in mind that 2018 marked the introduction of a dramatically more complex transaction reporting regime which offers regulators a far richer data set to monitor market abuse more effectively, this failure to sanction would indicate to us that something isn’t right.

Whilst many firms are making great efforts to report STORs and to submit transaction reports, the FCA can only do its job effectively if those transaction reports are complete and accurate. If you are not completely confident that your transaction reports meet this requirement, talk to us about our ReportShield™ data quality, reconciliation and training services.

What do you think about this peer review from ESMA? Join in the conversation over on our LinkedIn.