FCA is still concerned about firms’ market abuse surveillance as required by MAR
In its latest Market Watch newsletter, the FCA made clear its concern that “….. requirements for market abuse surveillance are still not being fully met, 5 years after the introduction of the Market Abuse Regulation (MAR) in 2016.”
And even when surveillance is being performed, the FCA has stressed the importance of capturing all relevant data, in particular the inclusion not just of executed trades, but orders too: “Orders are a critical component in effective monitoring for some types of actual or attempted market manipulation, e.g., layering and spoofing as well as cross venue and product manipulation where users have a unique line of sight of their own trader activity. If firms do not capture all unexecuted orders, they may fail to identify this activity.“
With another repeated reminder to firms, the FCA states that they cannot merely assume that if their peer group does not meet its MAR surveillance requirements then they are safe too “.…. some firms consider that their own failings can be excused by a perception that some of their peers are failing in the same way. We reiterate that our previous acknowledgement that industry in general faces specific challenges will not lead to us accepting failure to comply with UK MAR because other firms are in a similar position“.
FCA ends this latest Market Watch newsletter with a reminder that could not be clearer, firms cannot ignore their obligation to conduct market abuse surveillance “Firms should consider our comments in this Market Watch and take steps to ensure that they are monitoring all orders and transactions to detect and report potential market abuse.“
This is the latest in many reminders in recent years from FCA about the importance of MAR surveillance.
GRSS has been established to assist firms conducting both trade and e-comms surveillance in order to meet their regulatory requirements under MAR. If you would like to discuss this please contact Sarah Donnelly [email protected]