FCA has fined Sigma Broking Limited and has banned and fined its former directors. The firm failed to make reports, or accurate reports, on 56,000 CfDs over a period of just over 18 months to August 2016, and also failed to identify 97 suspicious transactions that it should have reported to FCA.
FCA found that many of the failings resulted from inadequate governance and oversight, and as a result it:
- fined the firm £531,000;
- banned its former CEO and another former director from holding significant management functions in regulated firms and fined them £67,000 and £69,600; and
- fined a current director £83,000.
The failings arose after the firm started to deal in CfDs. The Board did not take fundamental steps to ensure its members had appropriate MI to govern effectively and failed to set up an effective compliance function and market abuse prevention systems and controls. The compliance department did not have clear reporting lines, properly allocated responsibilities and lacked staff with appropriate qualifications. This resulted in the firm reporting only one leg of its two-legged matched principal trades, as well as failing to identify or report any suspicious orders or transactions.