JP Morgan, Citi and Deutsche fined $4.75m for access violations

FINRA, Nasdaq, Bats and NYSE pursued action against firms for violating market access rules in the US.

JP Morgan, Citigroup, Deutsche Bank and Interactive Brokers have collectively been fined $4.75 million in the US for violating market access rules.

The Financial Industry Regulatory Authority (FINRA) alongside major exchange groups like Nasdaq, NYSE and Bats, pursued the action after finding insufficient risk management controls.

Market access rules in the US require broker-dealers that access an exchange or alternative trading system to adequately control financial and regulatory risks of providing such access.

The firms fined failed to have regulatory controls and procedures to prevent the entry of erroneous and duplicate orders and some orders exceeded pre-set credit or capital thresholds.

The failures cost JP Morgan $800,000, Deutsche Bank $2.5 million, Interactive Brokers $450,000 and Citigroup $1 million in fines. 

“It is important that firms have reasonable market access procedures in place to appropriately monitor for errors and risks that can be harmful to the integrity of our securities markets,” said FINRA and the exchange groups in a joint statement.

The firms neither admitted nor denied the charges but consented to the entry of FINRA’s findings.