BNP Paribas SA was reprimanded and fined HK$11 million ($1.4 million) by Hong Kong’s securities regulator for failing to report more than HK$6 billion of cross trades over a 10-year period.
BNP Paribas Securities (Asia) Ltd. failed to report 4,443 pairs of cross trades to the Hong Kong stock exchange from December 2002 to January 2013, the Securities and Futures Commission said in a statement on Monday. In a cross trade, buy and sell orders for the same stock are offset without recording the trade on the exchange.
The firm failed to provide the dealers responsible for the reporting with sufficient resources to discharge their duties, the regulator said. The failures were “particularly serious” as they lasted for an extended period of time and involved a large number of trades, it said.
“This case demonstrates that reporting failures cannot be taken lightly,” Mark Steward, the regulator’s executive directive of enforcement, said in the statement.
BNP Paribas said in a statement that it had strengthened internal controls so that “the issues noted by the commission cannot be repeated.” The company “seeks to uphold the highest levels of regulatory compliance and looks forward to continuing to deliver a high level of service to its clients,” it said.
BNP Paribas has introduced an automated process to electronically report the type of transactions, outside of trading hours, which led to the fine, the securities commission said in a separate statement of disciplinary action. In February 2013, the company had told the regulator of its failure to report about 4,000 of the “late cross trades,” the SFC’s summary of facts showed.
APAC Financial Markets • #BNPParibas, #Fines, #HongKong, #Regulator #MarketNews
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