The UK branch of a German bank has been fined £595,000 for breaches of SUP 17 arising from failures to submit accurate transaction reports regarding an estimated 94% of reportable transactions over a 2 year period.
The failures took place after the implementation of MiFID across all EEA Member States in November 2007 when EEA authorised firms such as the bank were required to comply with FSA transaction reporting requirements. Although the bank identified the issue, the system put in place to meet the new requirements was deficient.
The FSA Final Notice notes that no action is taken in relation to the bank’s systems and controls since these are a matter for the German regulator. However, it also states that the matter is viewed seriously because, although individuals within the bank were aware of reporting issues, these were not escalated to management. Further, when the FSA discovered data errors and asked for checks to be carried out, no action was taken and the relevant individuals did not appreciate the regulatory implications.
View FSA fines Commerzbank for failures in transaction reporting, 27 April 2010
View FSA Final Notice - Commerzbank AG, 27 April 2010