Merrill Lynch Far East Limited (MLFE) and Merrill Lynch (Asia Pacific) Limited (MLAP) were fined HK $15 million (approximately US $2 million) by the HK Securities and Futures Commission for not complying with large order position reporting requirements for futures and stock options; for deficiencies of governance, testing, recordkeeping and risk controls for MLFE’s electronic trading system for futures; and for distributing futures research reports without disclosing their market making activities. In response, the firms engaged an independent consultant during the last quarter of 2016 to review their internal controls related to these matters. In determining the firms’ sanction, SFC considered MLFE’s and MLAP’s “prompt cooperation.” Without this, said SFC, “similar failures would have resulted in a substantially higher level of fine.”