The FCA has charged a former employee of a major investment bank and an associate for alleged insider dealing linked to a corporate takeover. According to the FCA, confidential information was misused for personal gain, resulting in significant profits. The case was detected through advanced market surveillance and is now progressing through the courts.
This is not an isolated case. The FCA also recently announced an arrest in a suspected market manipulation investigation, underscoring its commitment to tackling all forms of market abuse.
The FCA’s latest insider dealing charges are a clear signal that market abuse enforcement is accelerating. Firms need to reinforce their surveillance and governance controls or face elevated regulatory and reputational risk.
Why Does This Matter for Buy-Side Firms?
The arrest and fines make the FCA’s message very clear, market abuse remains a top priority for enforcement. These are part of a broader pattern of heightened scrutiny, and firms should expect the FCA to continue investing resources in identifying and prosecuting misconduct.
Detection capabilities are also evolving. The FCA’s ability to flag suspicious trading patterns demonstrates how regulators are leveraging advanced technology and data analytics to uncover misconduct faster and more effectively than ever before. Firms that rely on outdated or manual processes are increasingly vulnerable.
Finally, the reputational and operational fallout from insider dealing is significant. Beyond financial penalties, firms risk losing investor confidence, damaging client relationships, and facing intrusive regulatory investigations that can disrupt business operations for months or even years.
This case is not an isolated incident; it’s part of a global trend. Regulators worldwide are doubling down on insider dealing and market abuse, and firms that fail to modernise their compliance programmes are putting themselves at serious risk.
Prevent Insider Dealing Before It Happens
Firms cannot afford to treat market abuse as a tick-box exercise. Here’s what proactive compliance looks like:
- Conduct regular market abuse risk assessments to identify gaps in controls and governance.
- Deploy advanced surveillance tools that monitor trading patterns and flag anomalies in real time.
- Strengthen policies and training, so staff understand what constitutes information and how to handle it.
- Review governance and escalation procedures to ensure swift action when red flags appear.
- Test your controls under stress scenarios; don’t wait for a regulator to do it for you.
The cost of poor market abuse surveillance is far greater than the investment required to conduct this effectively. Independent expertise and technology can help firms stay ahead of regulatory expectations, reduce risk exposure, and maintain trust with stakeholders.
Would you like to understand what the FCA expects, and how your firm can stay ahead of intensifying market abuse scrutiny? Watch our on-demand webcast.
Build a Strong Defence Against Market Abuse
Combining a robust risk framework with advanced surveillance technology gives firms the strongest possible defence against insider dealing and market abuse. This can be achieved with ACA’s Market Abuse Risk Framework paired with ComplianceAlpha@’s Market Abuse Surveillance solution.
- Market Abuse Risk Framework: Built by buy-side practitioners, this framework gives firms a regulator-ready view of risk across trading and reporting. It maps market abuse risks, reviews surveillance and governance, and covers complex asset classes, all in a reusable format that supports ongoing compliance.
- Market Abuse Surveillance: Delivered through the ComplianceAlpha@ platform, this program delivers automated alerts, advanced analytics, and integrated workflows to detect suspicious activity across multiple asset classes, helping firms streamline monitoring and respond faster to potential risks.
Together, these solutions transform surveillance data into a strategic advantage and strengthen your compliance programme against regulatory scrutiny.