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FCA sees deficiencies in MAR implementation and a fine

Earlier this week, Julia Hoggett, Director of Market Oversight at the FCA, made a speech at the AFME Implementation of the Market Abuse Regulation in the UK event. It can be found here. The speech makes several points around the implementation of MAR and anti abuse policies in general, including combating conduct risk. Some of the points include:

  • The  need to have a policy that prevents abuse in addition to a mechanism that detects it after the event.
  • A reminder that anti abuse processes and technologies should not be based on that used by peers (see here).
  • Comments on the use of Artificial Intelligence, including: “a world where seemingly ‘rational’ AI, unconstrained and exposed to certain markets and data, would deem it entirely rational to commit market manipulation. Now, the FCA cannot prosecute a computer, but we can seek to prosecute the people who provided the governance over that computer.”
  • The continued lack of STORs (Suspicious Transaction and Order Report) from fixed income and commodities. In general these asset classes are still behind equities in anti abuse provisions.

Julia Hoggett made a speech in November 2017, which also discussed deficiencies in MAR implementation in fixed income and commodities (see here). There is clearly still some way to go in the eyes of the FCA.

At the end of January, Standard Chartered Bank were fined $40 million by New York’s Department of Financial Services for rigging the FX market, primarily in chat rooms. The press release can be found 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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