The Financial Conduct Authority (FCA) ordered the UBS AG to pay a fine amounting to £27.6 million in relation to the 135.8 million transaction reports of the company from November 2007 to May 2017.
FCA said that the firm failed to secure complete and accurate information of their reportable transactions worth approximately 86.7 million. FCA also found that the firm unnecessarily reported 49.1 million transactions to the regulatory body which breaches its rules for nine and a half years.
According to Mark Steward, FCA Executive Director of Enforcement and Market Oversight, firms must have proper systems and controls to identify what transactions they have carried out, on what markets, at what price, in what quantity and with whom. He added that if firms cannot report their transactions accurately, fundamental risks arise, including the risk that market abuse may be hidden.
Complete, accurate, and timely reporting of transactions is needed for effective market oversight. The information gathered by the United Kingdom's regulatory body helps them to effectively supervise companies and the markets. The transaction reports of the company help FCA in identifying potential occurrences of market abuse and in combat with financial crime.
According to the FCA, UBS failed to take responsibility in organizing and controlling its affairs responsibly and effectively with respect to its transaction reporting. The company failed to report its change management process, its maintenance of the reference data used in its reporting and how it tested whether all the transactions it reported to the FCA were accurate and complete.
The UBS was qualified for a 30 percent discount in the overall penalty after they agreed to resolve the case. The imposed penalty for the failures of the company is £39,427,795 without the discount.
FCA recently added another firm, Sucdens Financial or Sucden Financial, to its warning list. The firm belongs to Sucden Financial Limited which is an FCA-regulated London brokerage that offers a trade in FX, commodities, equities and more. According to the FCA, Sucdens Financial is a clone firm because of an almost identical name and a number of other violations. A firm is considered a clone if copies the details of another company in order to appear legitimate and trick investors.
The FCA said in a statement that the FCA authorized firm Sucden Financial Limited, which fraudsters are claiming to work for, has no association with the 'clone firm'. The regulating body added that Sucden Financial Limited is authorized to offer, promote or sell services or products in the UK.
