Laura WilesThe FCA has fined Mako Financial Markets Partnership LLP £1,662,700 for financial crime systems and controls failures. The firm had also failed to adequately apply policies and procedures it did have in place.
The case is the eight enforcement action brought by the FCA, concluding its investigations into cum-ex trading, which have resulted in more than £30m in fines.
From December 2013 to November 2015, Mako executed alleged over-the-counter equity trades on behalf of clients of the Solo Group, a group of four authorised entities. The trades were worth approximately £68.6bn in Danish equities and £23.6bn in Belgian equities, for which Mako received compensation of around £1.45m. The trading was circular, and therefore highly indicative of financial crime.
Mako failed to identify red flags in other instances related to the Solo Group, including a series of transactions with no obvious rational which resulted in the Group’s controller incurring a €2m loss to the benefit of his business associates. Mako also received payment from a UAE third-party linked to the Group for outstanding debts owed to its clients, without conducting any due diligence.