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Merrill Lynch fined £34.5m for failing to report ETDs under EMIR

It has been announced today that Merrill Lynch International has been fined £34,524,000 by the UK’s Financial Conduct Authority (FCA) for failing to report Exchange Traded Derivative (ETD) transactions under EMIR from 12 February 2014 to 6 February 2016. The fine relates to 68.5 million transactions and has been discounted due to early settlement. This is the first significant fine due to failed EMIR reporting, which has been in place since 12 February 2014. The FCA press release can be found here, and final notice can be found here. Merrill Lynch has previously been fined for MiFID reporting failures (see here).

The notice goes into a great deal of detail around the events leading up to the fine. Key factors include the lateness of the finalisation of the ETD EMIR requirements, the resourcing around reporting, the oversight and testing and also subsequent remediation. The fine considers all of these matters.

This first fine comes only one week before the start of significant changes to EMIR reporting (see here). The changes proposed by the EMIR review include one where in many cases the reporting of ETDs will be delegated to other parties such as the CCP (see here).


About avivhandler

Aviv is the Managing Director of ETR Advisory, a niche consultancy focused on the regulation of the commodity, energy and financial markets. He has more than 23 years of experience in the financial, energy and commodity markets, covering regulatory compliance, credit, risk and financial technology. Prior to founding ETR, he was Partner at SunGard Global Services, where he built a Centre of Excellence in European Energy and Commodity Regulation. Before that, he founded Coherence, a consulting firm specializing in credit risk in commodity and energy trading as well as software product management. The credit practice ultimately became part of Sirius Solutions, where he was the Managing Director of Europe. He has also held management roles at KWI and Iris Financial, among other organizations. Mr. Handler holds a degree in computer science from Imperial College, University of London.


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