Telephone 020 3813 2890 for a free no obligation chat about your regulatory requirements with one of our compliance consultants.

© Compound Growth Limited 2012 - 2018 | Terms of Use

Registered in England and Wales as limited company number 07626537 - Registered Office 120 Pall Mall, London, SW1Y 5EA

We use cookies, if you consent to this use, please continue to browse our site.

Here to help with Regulation and Compliance

Compound Growth

FG18/5 FCA Guidance on Spotting Insider Dealing & Market Manipulation

17th December 2018

Insider Dealing & Market Manipulation

Last Thursday 13 December 2018, the FCA published their Finalised Guidance on Financial Crime Systems and Controls, FG18/5.

Earlier on in the year the FCA had consulted upon adding in a chapter in their Guidance on insider dealing and market manipulation. Now, following the feedback received to their consultation, the regulator has published their revised Guidance on Financial Crime Systems and Controls with an additional chapter covering these issues.

The new chapter on insider dealing and market manipulation – found in chapter 8 of the guidance - outlines observations of both good and bad market practice around the requirement to detect, report and counter the risk of financial crime in relation to insider dealing and market manipulation.

As noted in the Guidance, insider dealing is a criminal offence as detailed in section 52 of the Criminal Justice Act 1993 and sections 89–91 of the Financial Services Act 2012 set out a range of behaviours which amount to criminal offences. Together these are referred to in the FCA’s Financial Crime Systems & Controls Guidance as market manipulation.

The Guidance specifies that a ‘financial crime’ includes any offence involving:

• fraud or dishonesty,
• misconduct in, or misuse of information relating to, a financial market,
• handling the proceeds of crime, or
• the financing of terrorism’.

Thus, both insider dealing and market manipulation both meet this definition, in particular because they involve misconduct in a financial market, and all references to insider dealing and market manipulation in the FCA’s Guidance refers to the criminal offences as detailed above.

Next Steps:

As firms will know, the Financial Crime Guide for firms consolidates the FCA’s guidance on financial crime and aims to enhance a firms’ understanding of the regulator’s expectations of systems and controls in this area. In addition, the Guide gives practical help and information to firms of all sizes on actions that they can take to counter the risks that their firms may be used to further financial crime.

Firms should familiarise themselves with the FCA’s guidance and in particular, the new content within the newly published chapter on insider dealing and market manipulation.

Read our latest articles, news and views affecting compliance and regulation in the UK Financial Services Industry.