The FCA announced last week it had issued its first fine for transaction reporting failures under MiFIR.
The regulator said: “Infinox Capital Limited (Infinox) has been fined £99,200 [$§123,000] by the FCA for failing to submit 46,053 transaction reports which risked market abuse going undetected.”
“Between 1 October 2022 and 31 March 2023, Infinox failed to submit transaction reports for single-stock contracts for difference (CFD) trades executed through one of its corporate brokerage accounts. Trades executed through this corporate brokerage account accounted for the majority of this business line,” a press released said.
“Although Infinox identified its failure to submit these transaction reports following a third-party review, it did not proactively report the breach to the FCA. The FCA independently identified this discrepancy in transaction data submitted by Infinox. The breach highlighted weaknesses in Infinox’s transaction reporting systems and controls for a high-risk investment product.”
Ibex Compliance’s Seung Earm took a deep dive into the implications of the enforcement action for GRIP.
Contis Financial Services Limited (CFSL) has entered special administration. According to the regulator: “The Court decided to place CFSL into special administration on application by its directors. Joshua James Dwyer and Robert Spence of Interpath Limited were appointed as special administrators of CFSL.”
It said CFSL was responsible for the activities of its distributors, adding that “customers of the following distributor programmes are impacted by CFSL entering special administration:
- Trilogy;
- Ffrees;
- Naga Pay.
“The special administrators will provide a report to creditors within eight weeks of their appointment,” the FCA has said.
The FCA announced it had secured a confiscation order of £5,963,376.15, ($7,340,916) against convicted fraudster Guy Flintham.
A press release from the regulator said: “Mr Flintham is serving a six-year prison sentence having pleaded guilty to fraud by false representation. The fraudulent investment scheme operated by Mr Flintham took £19m [$23.4m] from over 240 investors.
“He made several fraudulent claims to investors, including about how the scheme was operated and the profits they were making. He falsified documents to support his claims.”
The regulator has said it “will now contact the identified victims of Mr Flintham’s fraud to provide further information.”
Southwark Crown Court in London has ordered a former Goldman Sachs analyst to pay £586,711 ($726996.53) in confiscation.
Mohammed Zina was found guilty of insider dealing last year and sentenced to 22 months in prison. Besides insider trading, Zina was also found guilty of taking out loans fraudulently from Tesco Bank, according to a report in the FT.
The paper has called the case, in which Zina’s brother was also involved, one of the most high-profile insider trading cases.
Consultation
The FCA has said the regulator and Practitioner Panel survey “is being sent to all regulated firms so they can share their feedback on how the FCA regulates the industry.”
According to the regulator, this is the “first time the survey will be sent out to all regulated firms allowing us to capture an even wider range of feedback.
“We use the survey results to better understand issues affecting firms and to assess any changes we should consider making so we can operate more efficiently and effectively. The survey is one of several sources of feedback used to evaluate our performance against key areas of our three-year Strategy,” the FCA said.
Results of the survey will be presented to the Practitioner Panel and Board and and then published in summer 2025.
In the latest push to align itself with the government’s pro-growth agenda, the FCA says it has set out “further proposals to support growing business and investment opportunities.”
Among the steps it’s taking, the regulator confirmed it was “consulting on a single standard for corporate bond prospectuses, covering both large and small (less than £100,000 [$123,100]) bond sizes. This would reduce costs and barriers for companies raising capital and give investors the information they need to make an informed decision.”
In a separate move, the FCA has confirmed it is “proposing to simplify the requirements that apply to listed companies when they issue further securities.”
Simon Walls, interim executive director of markets at the FCA, said: ‘We’re opening the door for corporates to issue bonds in small sizes so that a wider range of investors can invest in them. That’s more funding for companies, more easily, and more choice for investors too.”
