CommSec has been fined and has voluntarily refunded a combined total of $1.1 million in brokerage to more than 25,000 clients after a series of systems technical errors.
That’s about $44 for each customer.
The arm of the Commonwealth Bank also paid a total penalty of $700,000 on two infringement notices given to it by the Markets Disciplinary Panel.
The infringements relate to a series of disclosures which weren’t made to customers between August 2010 and February 2014 when CommSec connected to the systems of other players including a New Zealand-based financial services company and the Chi-X market.
There were also 50,484 confirmations sent to clients which should have informed them that CommSec was acting as the principal and not as an agent in trades.
The cause was a mismatch of data fields between different systems used in the transactions.
This put CommSec at odds with the the Corporations Act which requires enough technical resources to ensure that trading messages do not interfere with the “efficiency and integrity of the market”.
And the corporate regulator ASIC (Australian Securities and Investments Commission) moved in.
CommSec managing director Paul Rayson says there were no losses to customers and the errors have since been rectified.
“We notified relevant customers and no complaints or issues have been raised,” he says.
“Our customer and regulatory responsibilities are of paramount importance, and we have worked collaboratively with ASIC on these matters since notifying the regulator in 2013.
“We are fully committed to providing secure and convenient services to our customers.”
Here’s the infringement notice sent to CommSec:
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