Financial spread betting firm City Index has been fined around £0.5m for incomplete transaction reporting, prompting a widespread realignment of the importance of accurate record keeping across the spread betting industry.
Leading financial spread betting broker City Index has been fined £0.5m by the Financial Services Authority after widespread inaccurate transactional reporting, prompting the spread betting industry to tighten reporting measures and improve the standard of their record keeping.
Some 60% of trades were inaccurately reported by City Index from 2007-2009, totalling around 2 million individual transactions, with a further 55,000 going entirely unreported over that period, triggering fears amongst some analysts of widespread malpractice and insufficient record keeping across the spread betting industry.
With the high-profile City Index fine thrusting the issue further into the limelight, it is projected that more brokers will turn their emphasis to more stringent reporting requirements in future, as an attempt to meet the FSA reporting threshold and protect client interests.
In response to the fine, City Index said that while it accepts that errors were made, its clients were and will remain unaffected by their shortcomings. As a direct consequence of the findings, City Index has committed to improving its compliance and reporting functions in order to avoid falling further foul of FSA regulations.
It is thought that the fine will serve as a warning to other firms, prompting an industry-wide addressing of reporting practices to ensure FSA requirements are fully satisfied.