Market Abuse update - August 2015

The second quarter of 2015 saw continued regulatory focus on market and benchmark misconduct: the FCA and the US regulators imposed a series of record-breaking fines.  The FCA's latest Board minutes refer to a strong pipeline of expected cases, and to delays resulting from some significantly more complex cases and from external factors. The Fair and Effective Markets Review (FEMR) has made strong recommendations for future conduct, regulation and enforcement in the fixed income, currency and commodity markets. 

The FCA also imposed its highest fine to date for transaction reporting failures, stressing the importance of effective market monitoring and surveillance, and providing the industry with useful guidance regarding suspicious transaction reports and market monitoring.

Firms still have plenty of regulatory change to assimilate. In the UK, FEMR's recommendations are likely to lead to significant changes to the UK criminal market abuse regime.  In the EU, the Market Abuse Regulation comes into application in July 2016, the revised Markets in Financial Instruments Directive will impose further requirements in relation to high frequency and algorithmic trading, and there may be legislative agreement on the proposed Benchmark Regulation by the end of the year.  In the US, recent court cases in the US have challenged interpretations of the scope of insider trading.  Our briefing aims to assist firms in meeting the challenge of responding to these developments.

In this edition, we consider:

• Notable criminal prosecutions in the UK
• The impact of Newman on US insider trading cases
• Record enforcement action for fixed income, currency and commodity market manipulation
• The Fair and Effective Markets Review's Final Report and recommendations
• High frequency trading enforcement and upcoming regulatory changes
• The latest on benchmark misconduct and regulation
• The FCA's recent record fine for transaction reporting failures
• Good and poor practices regarding suspicious transaction reports
• Recent FCA thematic work and soft guidance
• An update on the EU Market Abuse Regulation

To read our full update please click here.