02 Sep 2014 | 11:52 am | 1 min. read
The number of suspicious transactions reported to the financial services watchdog has shot up by 28% since the FCA took over as City regulator, according to international law firm Pinsent Masons
Data obtained from the Financial Conduct Authority by Pinsent Masons shows that the number of suspicious transaction reports – often associated with suspected insider dealing – has increased from 1099 in 2012/13 to 1409 in 2013/14.
The figures also show that there has been a 316% rise in suspicious transactions in the past five years rising from 338 in 2008/9 to 1409 in 2013/14. On average 117 suspicious transactions are now reported per month compared to 28 per month five years ago.
Reports of 'Misuse of information', the most frequently reported abuse, rose 29% under FCA supervision, from 980 reports in 2012/13 to 1267 reports in 2013/14. Reports of 'distortion and manipulation' saw a 24% increase in the same time period.
A suspicious transaction is one in which there are reasonable grounds to suspect it might constitute market abuse, such as insider dealing or market manipulation. It has been a requirement of the Market Abuse Directive (MAD) since 2005 that firms seeing suspicious transactions must report these to the FSA/FCA so that it can review these and other similar transactions for evidence of market abuse.
Michael Ruck, a senior financial services enforcement lawyer at Pinsent Masons and formerly with the Financial Conduct Authority commented:
“The FCA and previously the FSA definitely upped its game regarding the profile of its insider dealing and market abuse enforcement action. The fear factor from this action and the current high profile markets investigations may be one reason to explain the rapid rise in suspicious transaction reports over the last few years.
“It may be suggested that as the markets have recovered over the past few years that there has been an increase in misconduct leading to the rise in reporting, however, firms and individuals are now far more cautious and making a suspicious transaction report affords them some peace of mind that the regulator won’t be knocking down their door early one morning following a tip-off from another source.
“The fear of non-compliance and even higher penalties now outweighs the fear of a regulator asking questions and potential enforcement action.
“Firms need to be fully up to speed on their reporting requirements and the current approach of the regulator.”
The FCA has vowed to continue to focus on potential financial crime risks, in line with their objectives to protect and enhance the integrity of the UK financial system and will take intensive and intrusive action where serious issues are identified.
Suspicious Transaction Reports (by authorised firms)
Apr 08- Mar 09 |
Apr 09 – Mar 10 |
Apr 10- Mar 11 |
Apr 11- Mar 12 |
Apr 12-Mar 13 |
Apr 13- Mar 14 |
||
Distortion/ manipulation |
56 |
66 |
59 |
71 |
97 |
120 |
|
False/ misleading |
10 |
5 |
11 |
18 |
18 |
12 |
|
Misuse of information |
272 |
323 |
530 |
521 |
980 |
1267 |
|
Other |
0 |
0 |
0 |
0 |
4 |
10 |
|
Total |
338 |
394 |
600 |
610 |
1099 |
1409 |
Multinational law firm Pinsent Masons has advised Tokai Carbon Co., Ltd. (“Tokai Carbon”) on the sale of its German subsidiary TOKAI ERFTCARBON GmbH (“TEG”), to Lenbach Equity Opportunities III. GmbH & Co. KG, which is exclusively advised by DUBAG Investment Advisory GmbH (“DUBAG”).
Multinational law firm Pinsent Masons has advised the shareholders of independent financial advisory and wealth management firm Shackleton, including the private equity buy-and-build specialist Sovereign Capital Partners, on the exit to Lee Equity Partners.
Multinational law firm Pinsent Masons has been announced by Business in the Community as one of The Times Top 50 Employers for Gender Equality in 2025. This year’s list marks the sixth time that the firm has been recognised for its commitment to embedding gender equality into all levels of the organisation.
Multinational law firm Pinsent Masons has advised the shareholders of independent financial advisory and wealth management firm Shackleton, including the private equity buy-and-build specialist Sovereign Capital Partners, on the exit to Lee Equity Partners.
Multinational Law firm Pinsent Masons played a key role in advising the UK-based infrastructure asset manager Dalmore Capital through its acquisition by UK pensions and investment giant Royal London.
Multinational law firm, Pinsent Masons LLP, has advised IGCF VI Euro, L.P. a sub-fund of Balbec Capital LP, a global alternative investment manager headquartered in the United States on its first European public securitisation in relation to the issuance of notes totalling EUR 392 million backed by a portfolio of reperforming Spanish mortgage loans, arranged by Goldman Sachs.
For all media enquiries, including arranging an interview with one of our spokespeople, please contact the press office on
Location contacts
Europe: [email protected]
Asia: [email protected]
Middle East: [email protected]
Australia: [email protected]