Barclays fined for order audit failings

Barclays has been fined $1.3 million for order audit reporting violations and related supervisory failures.

The financial industry regulator authority (FINRA) has announced that it has fined Barclays $1.3 million for systemic Order Audit Trail System (OATS) reporting violations and related supervisory failures.

FINRA claimed to have found 15 systems issues at Barclays that gave rise to several OATS reporting violations. According to FINRA rules, firms are required to report to OATS, complete and accurate data relating to events in the lifecycle of an order. These reports are known as Reportable Order Events (ROES).

It was stated that Barclays was fined for failure to transmit millions of ROEs to OATS as well as using a supervisory system that was not designed to achieve compliance with its OATS reporting obligations.

When asked about the fines, Barclays Capital did not admit nor deny the charges; however, it did consent to the entry of FINRA’s reported findings.

Thomas Gira, executive vice president and head of market regulation at FINRA, said: “When firms fail to transmit OATS data or transmit inaccurate or incomplete data to OATS, market integrity is compromised because potential violative conduct, including manipulative activity and customer harm, may be obscured”

In addition, Gira claimed that OATS data is essential to FINRA’s automated equities surveillance program and is therefore critical to investor protection.