The FCA has published a decision notice against a broker (Linear Investments Limited) with respect to historic failings in the systems and controls applicable to its Direct Market Access business.
The FCA's press release states this is the first case to be completed under the new process introduced for partly-contested cases. The process enables firms or individuals under investigation to agree to certain elements of the FCA's case and to contest others before the FCA’s Regulatory Decisions Committee (RDC). The firms or individuals remain eligible to receive an early settlement discount of up to 30 per cent of the amount of any fine imposed.
In this case, Linear agreed facts and liability, but contested the level of the proposed penalty before the RDC. It appears from the Decision Notice that the RDC decided to reduce the amount of the penalty by 10 per cent to take account of the firm's mitigation. Linear has referred the issue of penalty to the Upper Tribunal for determination.
This is the first example of a firm using the new process since its introduction in March 2017. It remains to be seen whether this will become a popular option for firms and individuals under investigation by the FCA.
The Financial Conduct Authority (FCA) has today published a Decision Notice concerning Linear Investments Limited. Linear failed to take reasonable care to organise and control its affairs responsibly and effectively to ensure potential instances of market abuse could be detected and reported. The failure occurred from 14 January 2013 to 9 August 2015. Linear has referred the issue of penalty to the Upper Tribunal.