Understanding Market Abuse Law and Regulation
In June 2022, the FCA issued an update on its work to prevent and detect insider dealing and market manipulation. The press release highlights that the regulator takes a data-led approach in relation to market abuse.
This is driven by the 30 million transaction reports and 100 million order reports it receives each day, complemented by Suspicious Transaction and Order Reports sent to the FCA in accordance with the UK Market Abuse Regulation (MAR). These average at over 90 a week.
The overall message is clear – the FCA is watching!
Here are three points that you can share with your employees to remind them of their responsibilities under market abuse law and regulation. A PDF version can be downloaded here.
- Insider Dealing: Insider dealing and unlawful disclosure of inside information are criminal and civil offences. MAR defines inside information as non-public information which is precise and price-sensitive and which relates directly or indirectly to one or more issuers or financial instruments.
- Market Manipulation: Market manipulation is also prohibited under the criminal and civil law. Market manipulation can take many forms including deceptive trading practices and the dissemination of false or misleading information (including, by spreading market rumours).
- Reporting Suspicions: Firms that arrange or execute transactions are required to report suspicious orders or transactions to the FCA without delay. So, if there are reasonable grounds to suspect market abuse, you must escalate your concern in accordance with your procedures.