Merrill is hit with record £13.2m fine

THE London division of US banking giant Merrill Lynch has been hit with a record £13.2m fine for filing inaccurate reports on more than 35m trades.

The wrongdoings, which included not telling regulators about 121,387 trades, carried on between November 2007 and November 2014.

The Financial Conduct Authority said the sheer number of transactions involved and the fact the misconduct persisted for seven years despite repeated warnings led to the record penalty.

Merril Lynch was fined £150,000 for failing to report more than 1m trades accurately for more than a decade. Georgina Philippou, the FCA’s acting director of enforcement and market oversight, said ‘the size of the fine sends a clear message that we expect to be heard and understood across the industry’.

She added: ‘Accurate and timely reporting of transactions is crucial for us to perform effective surveillance for insider trading and market manipulation.’

The penalty comes in the wake of another record £126m fine handed down by the watchdog to the London branches of a US bank Bank of New York Mellon for failing to protect clients’ money.

European rules dictate banks must keep detailed records of the millions of transactions and trades. This information, including what is being traded, how much and the identity of the client, has to be sent to the FCA daily.

This is meant to enable the watchdog to pick up suspicious movements in the markets.

DEUTSCHE Bank has set aside £1bn to cover the costs of potential fines it faces over Libor rigging and other market manipulation.

The German lender, which employs more staff in London than it does in its home market, did not break out specifics of the bills that it will face.