Macquarie fined $16 million in UK over more than 400 fictitious trades

LONDON (Reuters) -The London branch of Australia's Macquarie Bank has been fined 13 million pounds ($16 million) for "serious failings" after an employee recorded more than 400 fictitious trades and concealed trading losses, the markets regulator said on Tuesday.

The Financial Conduct Authority (FCA) said Travis Klein, a relatively junior trader based at the bank's London metals and bulks trading desk, successfully bypassed three internal controls for over 20 months between 2020 and 2022.

The fictitious trades cost Macquarie Bank Limited (MBL) an estimated $57.8 million to unwind but did not affect customers or the market overall, the FCA said.

"If MBL had taken timely action to plug these gaps in their systems and controls, this cost could have been substantially reduced or avoided altogether," it noted.

Macquarie said it had self-reported the incident in 2022, noting it had been an isolated event, had not affected clients or the market and had not been financially material to the group.

"We have focussed significant resources on addressing learnings from the incident and implemented a series of improvements to our control environment in response to the incident," the bank said in a statement.

It qualified for a 30% reduction in the penalty for cooperating with the investigation.

Klein, meanwhile, has been banned from the financial services industry for acting dishonestly and without integrity and would have been fined 72,000 pounds if he had not faced serious financial hardship, the FCA said.



Reuters was not immediately able to contact him for comment.

($1 = 0.7956 pounds)

Source: Investing.com