ESMA Slaps DTCC Derivatives Repository with €408K Fine
- The trade repository had seven instances of violating data reporting provisions.
The European Securities and Markets Authority (ESMA) announced on Monday that it has imposed a total penalty of €408,000 on DTCC Derivatives Repository Plc (DDRL) for multiple violations in data reported under the European Market Infrastructure Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term (EMIR).
The European Union regulator detailed that the trade repository made seven infringements regarding data confidentiality, data integrity and direct and immediate access to data. The breaches made between 2014 and 2018 were the result of negligence on the part of DDRL.
The regulator detailed that the breaches were related to data access to certain asset managers which they should not receive, setting up its IT system by altering the substance of certain information reported to DDRL, and failing to provide regulators with direct and immediate access to relevant data.
Further, the trade repository failed to provide direct and immediate access to its data to the regulators by generating reports based on incorrect data. It did not provide with transaction data they were entitled to receive in line with their responsibilities and mandates and failed to provide all transaction data regarding OTC derivatives contracts.
The Necessary Data Reporting Obligations
“Today’s action against DDRL emphasizes the importance ESMA ESMA European Securities and Markets Authority (ESMA) is an independent Authority of the European Union that is responsible for the safety, security, and stability of the European Unions’ financial system and is charged with protecting the public. The European supervisory authority for the securities sector, ESMA was established on 1 January 2011. The European Securities and Markets Authority is an independent EU authority based in Paris. It aims to contribute to the effectiveness and stability of t European Securities and Markets Authority (ESMA) is an independent Authority of the European Union that is responsible for the safety, security, and stability of the European Unions’ financial system and is charged with protecting the public. The European supervisory authority for the securities sector, ESMA was established on 1 January 2011. The European Securities and Markets Authority is an independent EU authority based in Paris. It aims to contribute to the effectiveness and stability of t Read this Term places on trade repositories complying with their obligations on data confidentiality, integrity and access,” ESMA’s Interim Chair, Anneli Tuominen, said.
“The provision of timely, accurate and confidential data to CCP and derivatives markets supervisors is an essential requirement in facilitating the monitoring and identification of systemic risk in EU derivatives markets.”
EMIR provisions mandate trade repositories to provide data to the regulators which ensures protection of confidentiality and integrity. According to the EU regulator, DDRL has become the first trade repository to breach data reporting obligations.
The trade repository can now appeal against ESMA’s decision to the Board of Appeal of the European Supervisory Authorities.
“ESMA will continue to monitor this area and take the necessary action to promote stable and orderly financial markets,” Tuominen added.
The European Securities and Markets Authority (ESMA) announced on Monday that it has imposed a total penalty of €408,000 on DTCC Derivatives Repository Plc (DDRL) for multiple violations in data reported under the European Market Infrastructure Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term (EMIR).
The European Union regulator detailed that the trade repository made seven infringements regarding data confidentiality, data integrity and direct and immediate access to data. The breaches made between 2014 and 2018 were the result of negligence on the part of DDRL.
The regulator detailed that the breaches were related to data access to certain asset managers which they should not receive, setting up its IT system by altering the substance of certain information reported to DDRL, and failing to provide regulators with direct and immediate access to relevant data.
Further, the trade repository failed to provide direct and immediate access to its data to the regulators by generating reports based on incorrect data. It did not provide with transaction data they were entitled to receive in line with their responsibilities and mandates and failed to provide all transaction data regarding OTC derivatives contracts.
The Necessary Data Reporting Obligations
“Today’s action against DDRL emphasizes the importance ESMA ESMA European Securities and Markets Authority (ESMA) is an independent Authority of the European Union that is responsible for the safety, security, and stability of the European Unions’ financial system and is charged with protecting the public. The European supervisory authority for the securities sector, ESMA was established on 1 January 2011. The European Securities and Markets Authority is an independent EU authority based in Paris. It aims to contribute to the effectiveness and stability of t European Securities and Markets Authority (ESMA) is an independent Authority of the European Union that is responsible for the safety, security, and stability of the European Unions’ financial system and is charged with protecting the public. The European supervisory authority for the securities sector, ESMA was established on 1 January 2011. The European Securities and Markets Authority is an independent EU authority based in Paris. It aims to contribute to the effectiveness and stability of t Read this Term places on trade repositories complying with their obligations on data confidentiality, integrity and access,” ESMA’s Interim Chair, Anneli Tuominen, said.
“The provision of timely, accurate and confidential data to CCP and derivatives markets supervisors is an essential requirement in facilitating the monitoring and identification of systemic risk in EU derivatives markets.”
EMIR provisions mandate trade repositories to provide data to the regulators which ensures protection of confidentiality and integrity. According to the EU regulator, DDRL has become the first trade repository to breach data reporting obligations.
The trade repository can now appeal against ESMA’s decision to the Board of Appeal of the European Supervisory Authorities.
“ESMA will continue to monitor this area and take the necessary action to promote stable and orderly financial markets,” Tuominen added.