FCA Fines UBS £27.6m For Transaction Reporting Failures03.19.2019
UBS AG (UBS) has been fined £27,599,400 by the Financial Conduct Authority (FCA) for failings relating to 135.8 million transaction reports between November 2007 and May 2017.
Mark Steward, FCA Executive Director of Enforcement and Market Oversight said:
‘Firms must have proper systems and controls to identify what transactions they have carried out, on what markets, at what price, in what quantity and with whom. If firms cannot report their transactions accurately, fundamental risks arise, including the risk that market abuse may be hidden.’
Effective market oversight relies on the complete, accurate and timely reporting of transactions. This information helps the FCA to effectively supervise firms and markets. In particular, transaction reports help the FCA identify potential instances of market abuse and combat financial crime.
UBS failed to ensure it provided complete and accurate information in relation to approximately 86.67m reportable transactions. It also erroneously reported 49.1m transactions to the FCA, which were not, in fact, reportable. Altogether, over a period of 9 and a half years, UBS made 135.8m errors in its transaction reporting, breaching FCA rules.
The FCA also found that UBS failed to take reasonable care to organise and control its affairs responsibly and effectively in respect of its transaction reporting. These failings related to aspects of UBS’s change management processes, its maintenance of the reference data used in its reporting and how it tested whether all the transactions it reported to the FCA were accurate and complete.
UBS agreed to resolve the case and so qualified for a 30% discount in the overall penalty. Without this discount, the FCA would have imposed a financial penalty of £39,427,795.
C.S. Venkatakrishnan said his prognosis is excellent and his condition is curable.
The agencies found a shortcoming related to data quality and data management.
Goldman Sachs Asset Management agreed to pay a $4m penalty.
Investment bank has been impacted by industry-wide slowdown in capital markets and reduced sales & trading.
AllianceBernstein will deconsolidate Bernstein Research from its financial statements after closing.