Global network managers of custodian banks are redefining the word relationship when it comes to monitoring local agent banks that safekeep assets of underlying clients in multiple countries. It is no longer enough to make a sporadic visit or have a phone call. Global network managers have become detectives sifting through mounts of data to […]
MiFID II: Proving Best Execution Is Data Challenge
With the arrival of MiFID II, trade execution will no longer be solely the concern of the trading desk. It will take a village of compliance, operations, portfolio managers, IT managers and even website designers for financial firms to prove they have met the best execution requirements of the second incarnation of the Markets in […]
Blockchain for US Settlement: Three, Two, One, Takeoff? (Update)
(Editor’s Note: On Sept 14 itBit announced that its flagship Bankchain and other post-trade projects would be run out of a new firm Paxos with the same management. The former itBit, would be a division of Paxos, and continue to operate its crypto-currency trading platform). If US blockchain afficionados have their way, the technology […]
AML De-Risking: Regulators Warn No Big Brooms
Regulators on both sides of the Atlantic are putting banks in a Catch-22 of established regulatory penalties for serving financial criminals while simultaneously warning them that cleaning house by category will attract their attention. Recent announcements by the UK’s Financial Conduct Authority (FCA) and the US Office of the Comptroller of the Currency (OCC) suggest that banks better […]
New EU Insider Trading Rules Challenge: How to Monitor Intent?
No harm, no foul. That is the premise of how regulators typically work when it comes to deciding whether to fine a firm for wrongdoing. However, when it comes to new European regulations prohibiting insider trading and market manipulation, that will soon no longer be the case. The new European Market Abuse Regulation (MAR), effective […]
Fund Managers: Fixing EMIR Reporting Glitches
Now that more than a year has passed since they’ve had to deal with new reporting requirements under the European Market Infrastructure Regulation (EMIR), fund managers are belatedly waking up to the fact they could soon face whopping regulatory fines for not submitting correct data on their derivative transactions to accredited trade repositories. Regulatory operations […]
Phone Monitoring Records: Mining for Profit?
Three years after the UK’s Financial Conduct Authority (FCA) began requiring financial firms to record all mobile phone communications related to securities transactions, compliance remains dangerously weak. “Financial firms need to start thinking about just how they will comply and what additional benefits they can obtain for the costs involved,” says Rik Turner, senior analyst at […]
State Street Fine: Mind the Transition
When State Street Global Markets, a unit of mega custodian State Street, first acknowledged in 2011 that it had overcharged a UK pension fund client for transition management services, its public account sounded familiar. The bank did nothing wrong. Rogue employees, who violated bank policy, were to blame. They were dismissed and the client was […]
FCA Leaves Asset Owners to Self-Police Custodian Fees
In deciding not to monitor the fees charged by UK custodians for some value-added outsourced services, the UK’s securities watchdog may have just opened a floodgate of lucrative business for third-party consultants. A new committee just established by the UK fund management trade group Investment Management Association (IMA) along with fund managers and custodians is […]