ASIC accepts Macquarie Bank EU
The corporate regulator has accepted an enforceable undertaking from Macquarie Bank in relation to its wholesale foreign exchange (FX) business.
Following an Australian Securities and Investments Commission (ASIC) investigation, the regulator was concerned that the bank failed to ensure that its systems and controls were adequate to address risks relating to instances of inappropriate conduct identified by ASIC.
ASIC commissioner, Cathie Armour, said: “The wholesale spot foreign exchange market is one the world's largest financial markets and the proper functioning of this market is of vital importance to the Australian economy”.
“ASIC has now accepted undertakings from some of Australia's largest market participants to put in place forward looking processes and controls to ensure that their foreign exchange businesses provide financial services honestly, efficiently and fairly,” she said.
ASIC identified that employees of Macquarie’s spot FX business between 1 January 2008 and 30 June 2013 had:
- On a number of occasions, disclosed to external third parties confidential details of pending client orders including identification of a client;
- On a number of occasions, inappropriately disclosed to external third parties confidential and potentially material information about Macquarie’s trading activity associated with large pending AUD orders; and
- On a number of occasions, when the market approached the trigger price of a stop loss order, Macquarie spot FX traders responsible for managing the order traded in a manner that may have been intended to cause the trigger price to trade when it might not have traded at that time.
Macquarie would develop a program of changes to its existing systems, controls, training, guidance and framework for monitoring and supervision of employees in its spot FX and non-deliverable forwards businesses to prevent, detect, and respond to inappropriate disclosure of confidential information to external market participants, and inappropriate order management and trading in respect of stop loss orders.
ASIC said it would appoint an independent consultant to assess the program and implementation.
“Upon implementation of that program, for a period of three years, Macquarie will conduct an annual internal review of the program, which will be independently assessed, and provide an annual attestation from its senior executives to ASIC,” ASIC said.
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
