Compliance Corner: FCA, Citigroup Global Markets

Editorial Staff

22 August 2022

Financial Conduct Authority
The has fined Citigroup Global Markets £12,553,800 for failing to properly implement the Market Abuse Regulation trade surveillance requirements relating to the detection of market abuse.

London-based Citigroup Global Markets failed to effectively monitor its trading activities for certain types of insider dealing and market manipulation, the UK regulator said in a statement late last week.

By agreeing to resolve this case, Citigroup Global Markets qualified for a 30 per cent discount. Without this discount, the fine would have been £17,934,030 ($21,214,000).

The regulations, which came into force in 2016, require firms to take more action in detecting and reporting potential market abuse. It introduced a requirement to monitor both orders and trades to detect potential and attempted market abuse across a broad range of markets and financial instruments.

The FCA found that Citigroup Global Markets failed to properly implement the new requirement when it took effect. The firm took 18 months to identify and assess the specific market abuse risks that its business may have been exposed to and which it needed to detect.

“Citigroup Global Markets’ flawed implementation resulted in significant gaps in its arrangements, systems, and procedures for additional trade surveillance,” the FCA said.