UK regulator, the Financial Services Authority (FSA), has reinforced its transaction reporting guidelines, following a raft of recent fines issued to some of Europe's largest banks.
Since August 2009, the FSA has issued fines to five banks – Barclays, Commerzbank, Credit Suisse, Getco and Instinet – totalling over £7 million ($10.7 million) for having inadequate reporting arrangements.
In some cases no reports were filed for periods of over 12 months. Transaction reporting is used by the regulator to monitor market abuse.
At the time, several firms reported confusion over the reporting obligations as these were being handled by a third-party provider. During the investigations, the FSA noted that a number of the firms had used third-party approved reporting mechanisms to submit transaction reports to the FSA.
In all cases firms were paying for, or operating, transaction reporting services but failed to check on the reports that were being filed, despite being warned by the regulator about these reports.
In the July 2010 edition of its Market Watch Newsletter the FSA stresses that, “Where a firm engages another firm or service organisation to submit transaction reports on its behalf, the executing firm does not relieve themselves of their obligation to transaction report; the submitting firm or service serves only to transmit the transaction to us.”