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Banking giant Merrill Lynch fined £13.3m for 'failures'

By Graeme Evans

Published 23/04/2015

Warning: Philippou
Warning: Philippou

Merrill Lynch has been fined £13.3m by the City watchdog in the latest punishment of a banking giant for not reporting transactions properly.

The Financial Conduct Authority (FCA) said the Wall Street banking giant, which is part of Bank of America, incorrectly reported 35m transactions and failed to report another 121,387 between 2007 and last November.

It said the record fine reflected the severity of the bank's misconduct and its failure to adequately address the root causes over several years, despite a warning in 2002 and a fine in 2006.

The watchdog said accurate and timely reporting of transactions was crucial in order for it to spot insider trading and market manipulation.

FCA acting director of enforcement and market oversight Georgina Philippou said: "Proper transaction reporting really matters. Merrill Lynch International has failed to get this right again - despite a private warning, a previous fine, and extensive FCA guidance and enforcement action in this area.

"The size of the fine sends a clear message that we expect to be heard and understood across the industry."

The FCA increased its penalty scale to £1.50 per line of incorrect or non-reported data from the £1 per line in the three most recent cases because it said past fines have not been high enough to achieve credible deterrence. The watchdog has fined 11 other firms for transaction reporting breaches, including Deutsche Bank, Barclays, Credit Suisse and RBS.

A Merrill Lynch International spokesman said: "We are wholly committed to complying with all FCA requirements and continuously seek to improve all necessary aspects of our reporting.

"Today's decision principally refers to self-identified issues which we have sought to remediate as quickly as possible. We can confirm that no clients were financially impacted as a result."

 

£1.50

The amount of penalty per line of incorrect or non-reported data brought in by the FCA

Belfast Telegraph

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