Less than two weeks since FCA’s last Market Watch 64, another is forthcoming from the FCA, focusing on three important themes.
Firstly, the transaction reporting section of Market Watch 65 highlights several areas where firms are still getting it wrong due to failures in interpreting the detail and complex transaction reporting requirements, lack of appropriate infrastructure to facilitate timely submission of transaction reports, use of erroneous reporting fields and inconsistencies between information reported by trading venues and investment firms. To quote, “We previously reminded firms they should not assume a transaction report was accurate because it was accepted by the FCA.” Firms may find they are submitting inaccurate files that pass both FCA and Approved Reporting Mechanism (“ARM”) validations.
FCA advises that the reporting of errors or omissions should not be delayed until the issue is remediated and back reporting completed. Ellis Wilson can help firms identify transaction reporting errors swiftly with access to an automated reconciliation solution, help provide assurance that firms are reporting accurately or assist with file remediation.
Second, when dealing with suspected market abuse cases, FCA asks firms to consult with it before sharing information requests outside of the Compliance department lest they find themselves inadvertently either prejudicing FCA preliminary reviews and investigations and/or facilitate tipping off. Lastly, FCA reminds firms that material subject to legal professional privilege (LPP) should not be included in STORs submitted to the FCA so as not to lose any legal privilege rights. LPP may arise in the context of actual or pending litigation or when seeking or giving legal advice.