Aggregated News From Investment Management Regulators

Nasdaq Clearing receives warning and administrative fine of MSEK 300

Report/Flag

Please complete the required fields.



Finansinspektionen (FI) is issuing Nasdaq Clearing AB a warning for serious deficiencies in its operations, in part in conjunction with a member of the firm’s commodities market being declared in default in 2018. Nasdaq Clearing must also pay an administrative fine of SEK 300 million.

FI’s investigation was initiated by the incident in 2018 where a clearing member, a natural person, lost a large sum of money on the commodities market when the spread between Nordic and German electricity prices increased sharply. Because the collateral the member had pledged to Nasdaq Clearing was insufficient for covering the loss in the portfolio, money was withdrawn from the default fund, which consists of contributions from all clearing members and is intended to cover losses of this nature.

FI’s investigation shows that Nasdaq Clearing has had serious deficiencies in its operations. The requirements the firm placed on the clearing members’ financial and operational capacity have been insufficient, and an incorrect calculation has resulted in the firm issuing insufficient margin calls. The firm has also been in violation of the investment prohibition in the EU regulation on OTC derivatives, central counterparties, and transaction registers (EMIR) by investing its own funds in derivatives much too long after the default event, which resulted in prohibited exposures to credit and market risks.

The breaches also resulted in unacceptable risks in Nasdaq Clearing’s operations, which could have had a very serious impact on the financial system. The firm has also taken measures to rectify these deficiencies, and FI therefore takes the position that Nasdaq Clearing shall receive a warning and an administrative fine of SEK 300 million.

This news item was originally published by the Swedish Financial Supervisory Authority (FI SE). For more information, please see the Source Link.

Regulator Information

Abbreviation: FI
Jurisdiction: Sweden

Recent Articles

Grand Trust Holdings United Kingdom

We believe this firm may be providing financial services or products in the UK without our authorisation. Find out why you should be wary...

Announcement for the referral of a suspicion of violating Article (49) of the Capital Market Law and Article (2) of the Market Conduct Regulations...

In line with the Capital Market Authority's (CMA) responsibilities to protect the citizens and investors from unfair or unsound practices, and aiming to achieve...

Guidance on Application for Registration of a Virtual Assets Service Provider

Guidance Attachment: guidance_-_application_for_vasp_registration.pdf This news item was originally published by the British Virgin Islands Financial Services Commission (BVIFSC VG). For more information, please see the Source Link.

Virtual Assets Service Providers Guide to the Prevention of Money Laundering, Terrorist Financing and Proliferation Financing

Guidance Attachment: vasp_aml_cft_guidance.pdf This news item was originally published by the British Virgin Islands Financial Services Commission (BVIFSC VG). For more information, please see the Source...

Get the latest from Regulatory.News in your inbox!

×