FCA fines Merrill Lynch for failing to report 64m transactions

Merrill Lynch International has been hit with a large fine by the City watchdog for failing to report details of millions of financial transactions.

The Financial Conduct Authority fined the investment bank, the UK subsidiary of Bank of America, £49m in its first ever action against a firm for failing to report details of trading in exchange traded derivatives.

MLI will pay £34.5m after it agreed to settle at an early stage of the investigation and received a 30% discount.

The was found to have failed to report 68.5m transactions between 12 February 2014 and 6 February 2016, a requirement brought in under the European Markets Infrastructure Regulation (EMIR) after the financial crisis.

The FCA said reporting exchange traded derivative transactions "helps authorities assess and address the risk inherent in financial systems caused by a lack of transparency".

“Effective market oversight depends on accurate and timely reporting of transactions," said Mark Steward, FCA executive director of enforcement and market oversight.

"The obligations under EMIR, as with MiFID, are key aspects of such oversight.

“It is vital that reporting firms ensure their transaction reporting systems are tested as fit for purpose, adequately resourced and perform properly. There needs to be a line in the sand. We will continue to take appropriate action against any firm that fails to meet requirements.”