17 December 2017
visit www.avoka.com

FCA slaps £5.6 million fine on RBS for transaction reporting failures

24 July 2013  |  8081 views  |  1 RBS Bank branch sign

The Royal Bank of Scotland (RBS) has been fined £5.6 million by the Financial Conduct Authority (FCA) for incorrectly reporting transactions in wholesale markets, and in some instances, failing to report transactions at all.

RBS failed to properly report 44.8 million transactions between November 2007 and February 2013; and failed altogether to report 804,000 transactions between November 2007 and February 2012., says the FCA.

Many of the problems with RBS' own systems were compounded by the takeover of ABN Amro Bank in October 2007. However, the FCA considers that, "given the considerable resources available to RBS", it should have been able to overcome these challenges and ensure adequate systems and controls were in place.

Most of the errors involved using an incorrect reference code which made it impossible for the FCA systems to identify the counterparties to a transaction. Other inaccuracies included using the wrong timestamp, firm reference number or venue; incorrect prices; duplicate reporting; incorrect identifier and vague descriptions for OTC derivatives transactions.

Tracey McDermott, the FCA's director of enforcement and financial crime, says: "Effective market surveillance depends on accurate and timely reporting of transactions. We have set out clear guidance on transaction reporting, backed up by extensive market monitoring, and we expect firms to get it right."

She says the size of the penalty reflects the serious nature of the issue.

RBS agreed to settle at an early stage of the investigation, and received a 30% reduction of the fine. Without this discount, the financial penalty would have been £8,029,100.

Comments: (1)

A Finextra member
A Finextra member | 25 July, 2013, 10:20

This article states that “Most of the errors involved using an incorrect reference code which made it impossible for the FCA systems to identify the counterparties to a transaction.”

Two very large banks that I have spoken to have said that they each operate over 4,000 systems – that’s systems – for identifying clients, counterparties and service providers.  The KISS rule of reality says that the more systems and complexity you have, the more likely you are to get things wrong.

If anything speaks in favour of having a simple, unified system of unique entity identifiers to be used by all financial institutions and market regulators, this has to be an important example.  Bring on the Global Legal Entity Identifier System!

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

RBS issues second apology for mobile app glitch

RBS issues second apology for mobile app glitch

24 May 2013  |  7540 views  |  0 comments | 5 tweets | 4 linkedin
UK regulator begins probe into RBS IT disaster

UK regulator begins probe into RBS IT disaster

09 April 2013  |  7876 views  |  0 comments | 6 tweets | 2 linkedin
RBS preps £80 million IT overhaul - Telegraph

RBS preps £80 million IT overhaul - Telegraph

22 October 2012  |  9933 views  |  2 comments | 11 tweets | 2 linkedin
Santander blames IT integration issues for RBS branch network deal collapse

Santander blames IT integration issues for RBS branch network deal collapse

15 October 2012  |  11620 views  |  1 comments
SocGen hit with FSA fine for transaction reporting failures

SocGen hit with FSA fine for transaction reporting failures

25 August 2010  |  10716 views  |  0 comments
Barclays fined £2.45 million for transaction reporting failures

Barclays fined £2.45 million for transaction reporting failures

08 September 2009  |  8063 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.niceactimize.comvisit www.response.ncr.comvisit www.ebaday.com

Top topics

Most viewed Most shared
satelliteRipple completes XRP Lockup
10643 views comments | 3 tweets | 2 linkedin
PSD2: Laying the regulatory foundation for a new age in paymentsPSD2: Laying the regulatory foundation for...
10278 views comments | 18 tweets | 36 linkedin
Banks tap Ethereum smart contracts for MiFID II complianceBanks tap Ethereum smart contracts for MiF...
7647 views comments | 10 tweets | 10 linkedin
Banks and fintech startups join forces on blockchain-based supply chain pilotBanks and fintech startups join forces on...
7340 views comments | 19 tweets | 22 linkedin
hands typing furiouslyReshaping Customer Engagement & Da...
6760 views 0 | 4 tweets | 2 linkedin

Featured job

Competitive base, double ote, benefits
London, UK

Find your next job