Davy is hit with €50,000 fine by the Central Bank
Published 10/12/2011 | 05:00
THE Central Bank has fined Davy Stockbrokers €50,000 and reprimanded Ireland's largest stockbroker for breaching its regulations.
The bank said Davy failed to report 61,542 transactions between November 2007 and March 2011 that should have been reported at the end of each day's trading.
Davy also failed to report the correct counterparty -- such as the individual or company -- that was involved in another 20,806 transactions involving the trading of financial instruments over that period.
It was also found to have breached Central Bank regulations by failing to establish adequate policies and procedures to comply with the reporting requirements.
The Central Bank's director of enforcement, Peter Oakes, said that accurate reporting was essential in order for the regulator to monitor the markets and to detect market abuse and financial crime.
He said: "Where data does not meet the standards required, this jeopardises an important regulator function of the Central Bank.
"We will address these types of failures -- and other reporting failures -- with firms, including, where appropriate, by taking enforcement action."
Davy Stockbrokers said that the breaches were "technical" and had been reported to the regulator by the firm in September 2010.
"These were wholly technical reporting issues, with no client impact which were identified by Davy and voluntarily reported to the Central Bank," a spokesman said.
It is the second firm to be fined for this type of breach.
Last year, NCB Stockbrokers was fined €100,000 for incorrectly reporting 44,003 transactions and for failing to include correct details in 1,222 transactions.
The Central Bank can impose fines of between €500,000 and €5m for these offences.
New legislation that is due to be adopted by the Oireachtas will double these fines, so that the Central Bank will be able to impose sanctions of between €1m and €10m.
In relation to Davy, the regulator said the breaches "were unintended" and that once they had been detected the company submitted all transaction reports correctly.
"The penalties in this case reflect the importance the Central Bank places on accurate and complete reporting of transactions in financial instruments," it said.
New regulations were adopted to cover these activities in 2007.
The bank said it had taken Davy's "timely" action and its co-operation during the investigation into account in setting the fine and said the matter was now closed.
The number of transactions involved was about 1pc of the estimated 6m processed by Davy Stockbrokers between November 2007 and March 2011.