FCA warns Interactive Brokers (UK) Ltd over alleged business principles breach

Maria Nikolova

The warning notice is not the final decision of the UK financial regulator. Interactive Brokers (UK) Ltd has the right to provide information to the Regulatory Decisions Committee (RDC) that will decide on an action.

The UK Financial Conduct Authority (FCA) has earlier today announced that it had issued a warning notice to Interactive Brokers (UK) Ltd (IBUK).

In its announcement, which comes more than two weeks after the notice was issued to the broker, the FCA says that it proposes that the company takes action in order to tackle certain aspects of its conduct.

In particular, the FCA states that it believes that in the period from February 6, 2014 to February 28, 2015 (the Relevant Period) IBUK breached Principle 3 of the FCA’s Principles for Businesses. The latter is named “Management and Control” and states that “A firm must take reasonable care to organise and conrol its affairs responsibly and effectively, with adequate risk management systems.” The FCA alleges that in the relevant period, IBUK failed to take reasonable care to organise and control its affairs responsibly and effectively with adequate risk management systems in relation to the identification and reporting of possible market abuse by its customers.

The FCA considers that as a result IBUK failed on three separate occasions to identify and report to the regulator transactions which suspected to be market abuse in the form of insider dealing.

The FCA notes, however, that it does not consider that IBUK’s senior management or other staff were aware that its systems and controls fell short of required standards until an FCA visit to IBUK in December 2014.

The UK financial regulator adds that a warning notice does not represent its final decision. IBUK has the right to make representations to the Regulatory Decisions Committee (RDC) which will in its turn decide on any appropriate action and whether to publish a decision notice. In case a decision notice is issued, IBUK has the right to refer the matter to the Upper Tribunal which would reach an independent decision on the appropriate action for the FCA to take, if any.

If either the RDC or the Upper Tribunal decides that no further action should be taken, the FCA will publish a notice of discontinuance given it has IBUK’s approval.

Read this next

Retail FX

AvaTrade seals sponsorship deal with F1’s Aston Martin team

Dublin-based forex broker AvaTrade today announced that it has concluded a sponsorship deal with Formula One’s Aston Martin Cognizant team that entails sponsorship rights and other marketing benefits.

Executive Moves

M4Markets onboards Invaxa CEO Marios Antoniou as COO

Seychelles-regulated brokerage firm M4Markets has appointed Marios Antoniou, who has a colorful career within the foreign exchange industry, in the capacity of its Chief Operations Officer.

Digital Assets

GK8 now allows clients to control their digital assets as they would their fiat

“As the institutional market is increasingly turning to self custody, our policy engine empowers them to automate transactions, approvals, and even crucial workflows, while providing the highest degree of security, consistency, governance and control.”

Digital Assets

Retail CBDCs in the UK: “Welcomed” by CryptoUK and R3, but “Dystopian” for ETC Group

“At this stage, we judge it likely that the digital pound will be needed in the future. It is too early to decide whether to introduce the digital pound, but we are convinced preparatory work is justified”, said the BoE and HM Treasury.

Institutional FX

Centroid taps Iress API to provide retail brokers with real-time market data

“It has always been a challenge to have an efficient, elegant solution for market data and order execution for retail brokers, but with Iress we have found absolutely the right partner to add to our client offering.”

Digital Assets

Ramp launches FCA-approved off-ramp product, onboards Brave, Trust Wallet, Ledger

“To obtain and maintain our FCA registration, we must meet and operate within their strict anti-money laundering and counter-terrorist financing standards. This is a huge achievement for us, as compliance is a cornerstone of our business and what we stand for.”

Institutional FX

State Street launches FIX API for Fund Connect ETF platform

“Expanding from proprietary APIs to the FIX industry standard will bring us closer to our goal of 100% digital interactions. This is another example of innovations we’ve brought to our operating model as we celebrate 30 years of servicing ETFs since the launch of SPY.”

Industry News

HollyWally opens office in Portugal to bring B2B2C wallet-as-a-service platform to Europe

“We looked at a number of centers for startups throughout Europe and were attracted straight away to Lisbon. There is great Government support and enthusiasm for startups, it’s well positioned between our Asian and US offices, it’s a cost-effective city in which to base a fintech and it’s a beautiful place.”

Retail FX

Eightcap integrates Acuity’s economic calendar for trade ideas on MT4 or MT5

“By incorporating Acuity’s cutting-edge AI technology into our platform, we are able to offer our clients a powerful new tool that will help them stay ahead of the markets. We are committed to providing an extensive range of tools and educational resources that will enhance our clients’ trading experience and allow them to trade smarter.”

<