Interactive Brokers (UK) Limited was assessed a fine of GBP 1.049 million by the UK Financial Conduct Authority for allegedly not having adequate risk management systems to detect and report potential instances of market abuse, and for not filing certain reports of suspicious transactions, as required.

According to FCA, from February 2014 to February 2015, IBUK relied on a global compliance team at its US affiliate to conduct post trade surveillance. However, claimed the FCA, IBUK did not adequately oversee the US team’s reviews and ensure that the US team had “adequate guidance or effective training.” FCA also claimed that IBUK did not file suspicious transaction reports in connection with profitable trading close in time to a regulatory new service announcement on three occasions.

In its representations, IBUK said that it “incorporated into its systems the expertise of a substantial and well-trained team of compliance officers engaged by its US sister company to identify market abuse from a US And UK perspective.” In response, the FCA noted that, “[w]hile it was not unacceptable… for IBUK to outsource the review, this did not discharge IBUK’s own obligations in relation to the review process.”