Nomura fined 1.75m by the FSA for serious mis-marking
NOMURA has been fined £1.75m by the Financial Services Authority for “widespread systems and control failings” at its international equities division.
The problem came to light in June 2008 when a London trader noticed a Hong Kong trader had mis-marked his derivatives book.
The Hong Kong trader, who was suspended last year pending an investigation, over-valued instruments from January 2008 to June 2008. This resulted in the position needing an adjustment of £10.8m, then later another £5.5m.
FSA enforcement and financial crime director Margaret Cole said: “Financial instruments must be valued correctly by traders and a firm’s systems and controls must be able to minimise the risk of traders mis-marking their positions.
“When a firm’s systems and controls fall short of required standards, we will not hesitate to take action.”
Nomura, which disciplined other staff and whose fine was 30 per cent discounted for its cooperation, said in a statement: “Nomura identified the mis-marking in June 2008 and took immediate action. We conducted a full review and kept the regulator fully informed.”