The latest edition of Market Watch focuses on:
- rumours: FSA carried out a thematic project that looked at firms' policies on rumours, training and communication on those policies and monitoring of communications and trading. It found many firms try to define "rumour" and some specifically prohibit staff from originating or communicating them. Most have strict guidelines on communication and many use formalised training modules to bring staff attention to the problems. On monitoring, FSA notes increasing use of automated alert systems to spot unusual trading. It sees some benefits to close interaction between staff exposed to rumours with compliance officials, but thinks proactive communication monitoring is probably best. FSA has devised a hypothetical scenario and set out its ideas on best practice in dealing with it;
- sponsored access: FSA has reminded market participants of relevant rules and what it would expect them to do when offering sponsored access to clients; and
- credit default swaps: FSA has confirmed it expects most CDS will fall within the market abuse regime as "related investments" to instruments admitted to trading on the relevant markets.
(Source: Market Watch: Issue No 30)