Macquarie Securities pays $300,000 infringement notice
Macquarie Securities (Australia) Limited has paid a $300,000 penalty to comply with an infringement notice given by the Markets Disciplinary Panel (MDP).
The MDP had reasonable grounds to believe Macquarie contravened the market integrity rules that dealt with the provision of regulatory data to ASX and Chi-X.
Over a four-year period from July 2014 to July 2018, Macquarie transmitted approximately 42 million orders to ASX and Chi-X that included incorrect or omitted required regulatory data.
During the same period, Macquarie also submitted approximately 377,000 trade reports to ASX and Chi-X with the same deficiencies.
Missing and incorrect regulatory data included:
- ‘capacity’: a notation to identify whether Macquarie was acting as principal or agent;
- ‘origin’: a notation to identify the person on whose instructions Macquarie was acting; and
- ‘intermediary’: the Australian financial services licence (AFSL) number of an intermediary using Macquarie’s automated order processing system.
The MDP had found while Macquarie intended to comply with the market integrity rules, there were weaknesses in the configuration and integration of Macquarie’s systems, its processes for on-boarding new clients and its control framework.
The MDP considered Macquarie’s conduct to be negligent, due to Macquarie’s poor design and implementation of updates to key systems, the high number of orders and trade reports containing incorrect or missing data, the multiple categories of incorrect or missing data and the length of time the problems persisted without detection.
It was noted by the MDP that once Macquarie became aware of the scale of the issues which it reported to ASIC, it undertook a comprehensive review to identify the cause and promptly implemented remedial measures.
The compliance with the infringement notice is not an admission of guilt or liability and Macquarie is not taken to have contravened subsection 798H(1) of the Corporations Act 2001.
AUTHOR
Chris Dastoor
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