ESMA reports huge €78 million increase in market abuse sanctions in 2019

The EU regulator said that a total of €88 million in fines relating to 339 actions under the market abuse regulation were imposed in 2019, up from €10 million in 2018. 

ESMA has released its annual market abuse report confirming that it saw market abuse sanctions significantly increase to €88 million in 2019, up from just €10 million in the previous year.

Around €88 million was fined by national competent authorities (NCAs) and other authorities relating to 339 actions under the market abuse regulation (MAR), of which 279 were administrative and 60 were criminal. 

For the 279 administrative sanctions €82 million in financial penalties were handed out, while the 60 criminal infringements accounted for the remaining €6 million.

ESMA said that despite a marked decrease in the number of sanctions under MAR, falling from 472 in 2018 to 339 in 2019, the overall financial penalties imposed rose by 78 million.

The report added that criminal sanctions had increased four-fold to 60 from 15 in 2018, with financial penalties rising to €6 million in 2019 from €65,650 in 2018. ESMA attributed the significant increase to 42 criminal sanctions recorded in Germany alone.

“The report will help ESMA’s ongoing work in fostering supervisory convergence in the application of the MAR and contribute to ESMA’s goal to develop an EU outcome-focused supervisory and enforcement culture,” said ESMA. 

There has been a marked increase in the number of penalties and enforcements in recent years across the global financial markets.

Today’s announcement follows news earlier this month that the US derivatives watchdog the Commodity Futures Trading Commission had issued a record 113 enforcements in 2020, resulting in a whopping $1.3 billion in penalties.