Abstract：Citigroup Global Markets breached Article 16(2) of MAR, FCA's Principles for Businesses. The institutional brokerage firm has agreed to resolve the case, FCA says.
United Kingdom's Financial Conduct Authority (FCA) has fined Citigroup Global Markets, an indirect subsidiary of Citigroup Inc., £12,553,800 for breaching the Market Abuse Regulation (MAR) trade surveillance requirements relating to the detection of market abuse.
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FCA, which announced the fine on Friday in a statement, said the institutional brokerage services company failed to properly implement the regulation.
As a result, the broker breached Article 16(2) of MAR and Principle 2 of the FCAs Principles for Businesses, the regulator added.
While Article 16(2) requires organizations involved in arranging or executing transactions in financial instruments to establish and maintain effective arrangements, systems, and procedures to detect and report potential market abuse, Principle 2 demands that “a firm must conduct its business with due skill, care, and diligence.”
“By failing to properly implement the MAR trade surveillance requirements, Citigroup Global Markets could not effectively monitor its trading activities for certain types of insider dealing and market manipulation,” FCA explained.
The watchdog further explained that Citigroup Global Markets flawed execution opened up gaps in its arrangements, systems, and procedures for additional trade surveillance.
