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 market regulator said on Tuesday .
The Financial Conduct Authority (FCA) said Travis Klein, a relatively junior trader at London’s metals and bulk commodities trading desk, successfully circumvented three internal controls for more than 20 months between 2020 and 2022.
The fictitious transactions cost Macquarie Bank Limited (MBL) an estimated $57.8 million to settle, but had no impact on customers or the wider market, the FCA said.
“Had MBL taken timely action to close these gaps in their systems and controls, these costs could have been significantly reduced or avoided entirely,” the report said.
Macquarie said it had self-reported the incident in 2022, noting it was an isolated event, had not impacted customers or the market and had not been financially material to the group.
“We have committed significant resources to addressing the lessons learned from the incident and implemented a range of improvements to our control environment in response to the incident,” the bank said in a statement.
She was eligible for a 30% reduction in sentence for cooperating with the investigation.
Klein, meanwhile, has been banned from the financial services industry for dishonest and unintegrated trading and would have been fined £72,000 had he not been facing serious financial difficulties, the FCA said.
Reuters could not immediately contact him for comment.
($1 = 0.7956 pounds)
(Reporting by Yadarisa Shabong in Bengaluru and Kirstin Ridley in London; Editing by Sherry Jacob-Phillips and Mark Potter)
