- The Financial Conduct Authority fined Merrill Lynch £34.5 million for failing to report transactions.
- The bank failed to report over 68 million exchange traded derivative transactions between 2014 and 2016.
- The reporting requirement was a key reform following the 2008 financial crisis.
LONDON — The Financial Conduct Authority (FCA) fined American bank Merrill Lynch £34.5 million for failing to report transactions.
The FCA said the bank had failed to report 68.5 million exchange-traded derivative transactions between February 2014 and February 2016. This is the first time a firm has been fined for failing to report details of such trading.
“It is vital that reporting firms ensure their transaction reporting systems are tested as fit for purpose, adequately resourced and perform properly,” said Mark Steward, FCA executive director of enforcement and market oversight, in a statement.
“There needs to be a line in the sand. We will continue to take appropriate action against any firm that fails to meet requirements,” he said.
After the financial crisis, authorities made it a requirement for firms to report exchange traded derivative transactions, as part of a key reform to improve transparency and minimise possible risks in financial systems.
Merrill Lynch agreed to settle at an early stage in the FCA’s investigation, for which is received a 30% reduction in the overall fine. Without this discount, the fine would have been £49.3 million.
In 2015, the bank was fined £13.3 million by the FCA for incorrectly reporting over 35 million transactions and failing to report another 121,000, between 2007 and 2014.