Macquarie Bank repeated compliance 'failings' after facing record fine, ASIC's commissioner Simone Constant declares
The corporate watchdog is cracking down on a major bank for an array of 'repeated failings' regarding compliance issues, with some occurring after the bank was hit with a $5m fine in September.
The Australian Securities and Investments Commission on Wednesday took aim at Macquarie Group for major compliance failures.
ASIC has intervened with Macquarie over its futures dealing business and its over-the-counter derivatives trading – which are trades done outside of an exchange.
The watchdog said Macquarie had failed to stop at least 11 suspicious orders being placed in the futures market, one dating back to over a decade ago.
ASIC also identified nine "market conduct matters of concern" in just the past 18 months.
The watchdog's commissioner Simone Constant told Sky News' Business Now there were common causes for an array of failings across the major bank.
'There's been some repeated failings and when we think about the failings that we're addressing in these license conditions, another concern is there are common root causes,' Ms Constant said.
'While some are in the ASX 24 futures market and some are in terms of OTC products, root causes seem to be common.'
She noted Macquarie had committed repeated failings after it was fined $5m for failing to prevent suspicious orders being placed on the electricity futures market.
This was the highest penalty ever imposed by ASIC's Markets Disciplinary Panel (MDP).
'Something that concerned us was even when their attention was drawn to this area of concern and there was… an MDP outcome last year, there actually was repeated failing,' Ms Constant said.
'So it failed again.
"Responsibilities of gatekeepers, responsibilities of such significant and of successful organisations in markets like Macquarie and responsibilities for reporting, so that we can understand what's going on in markets in terms of integrity and where the risk is, these are really important responsibilities.'
Macquarie will now be forced to identify the root cause of its failures in a remediation plan.
It will also have to appoint an independent expert to review Macquarie Bank's plan and address its failures and prevent them happening in the future.
Macquarie Bank said it took its role as a licensed entity 'extremely seriously' and would cooperate with the investigation.
'In addition to working constructively with ASIC on these remediation activities, MBL continues to invest in a broader range of existing programs to strengthen its systems, controls and supervisory arrangements,' the bank said in a statement.
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