Poor controls on communications contribute to £4.7m market abuse risk fine

Weaknesses in controls on their voice brokerage systems were a significant reason for the £4.7 million fine imposed on three linked inter-broker dealing firms. The three - all part of BGC Inc - conducted 80 per cent of their business this way but used a "limited, sample-focused design that was not sufficient to provide adequate monitoring", according to the FCA.

By Neasa MacErlean

The fine (reduced by 30 per cent for co-operation) was imposed on BGC Brokers LP, GFI Brokers Ltd and GFI Securities Ltd for failings in their market abuse detection systems over 18 months to July 2018. The final notice provides detail on the kinds of issues over which the Financial Conduct Authority is now taking disciplinary action. In addition to the voice brokerage weaknesses, the firms did not comprehensively cover the required asset classes. The FCA says that the automated surveillance system that was in place "did not cover equity derivatives, futures and options or commodities (at both BGC and GFI), nor equities (at GFI)".