On 9 September 2009, the FSA announced that it had fined an investment adviser at a retail stockbroking firm £20,000 for a breach of Principle 3 in failing to identify that a transaction was being conducted on the basis of inside information. As a result of the failing, the firm was used to facilitate a transaction made on the basis of inside information and was prevented from considering whether to report the transaction to the FSA under the Suspicious Transaction Reporting regime.
Margaret Cole, FSA Director of Enforcement, said:
"This fine emphasises the importance of the Suspicious Transaction Reporting regime. Tackling market abuse and insider dealing is not just an issue for the regulator. Broking firms are the front line of defence against people who seek to misuse and profit from their possession of privileged information. STRs are a key tool for the FSA in detecting market abuse. Lockwood’s failure could have meant that this incident went undetected and unpunished. Approved persons should be in no doubt as to their responsibilities in this area and the FSA will not hesitate to take action where they fall down on these."
View FSA fines broker for failing to prevent insider dealing, 2 September 2009