A wealth management firm has been hit with a significant fine after failing to implement the correct systems which could have prevented market abuse.
WH Ireland, a UK-based firm, has been banned from taking on new clientele for a period of 72 days and ordered to pay £1.2million (C$2.32million) by the Financial Conduct Authority (FCA) for failures dating back to the period January-June in 2013.
According to the FCA, the company had not acted on advice and not put sufficient controls in place to detect and prevent insider trading.
Problems were originally identified back in August 2013 when the FCA asked for measures to be put in place to protect against both insider dealing and market abuse. However, the regulator’s orders were not met.
During this period, WH Ireland had around 9,000 private wealth clients as well as 87 broking clients in the corporate sector. It had around £2.5billion (C$4.8billion) in assets under its management. Mark Steward, the director of both market oversight and enforcement for the FCA, noted that the company was “especially culpable” for failing to take the chance it had been given.
WH Ireland was actually able to gain a 20 per cent discount on its fine as it agreed to a settlement – without this its fine would actually have been £1.5million with the restriction on new clients stretched to 90 days.
According to Richard Killingbeck, the chief executive of WH Ireland, the company regretted its failure to act faster.