Barclays gets $650,000 fine for systemic TRACE reporting issues
Barclays Capital has agreed to pay a $650,000 fine as a part of a settlement with the United States Financial Industry Regulatory Authority (FINRA). Barclays’ settlement offer was accepted by FINRA on December 1, 2020.
The settlement stems from what FINRA dubbed as “systemic TRACE reporting issues” that Barclays had during the period from January 2017 through April 2019. These issues resulted in violations of FINRA rules.
More specifically, from January 2017 through October 2018, Barclays consistently reported over 2% of its Corporate transactions to TRACE more than 15 minutes after the time of execution, resulting in about 1,000 late reports a month. The bulk of the late reports were caused by manual trade amendments or the trader (or salesperson) entering the trade late.
Also, from January 2017 through February 2019, Barclays often reported more than 3% of its Agency transactions to TRACE more than 15 minutes after the time of execution. These delays were primarily caused by mapping and technological issues.
Furthermore, from July 10, 2017 to April 30, 2019, Barclays reported to TRACE some 550,000 transactions (or 18.8% of its Treasury transactions) that it was not required to report. The over-reporting occurred in connection with Treasury transactions executed between Barclays and its affiliate. Barclays had no supervisory system in place to identify the over-reporting of transactions with its affiliates.
Finally, from January 1, 2017 through September 30, 2017, Barclays reported the incorrect execution time for 293 sampled Corporate transactions to TRACE.
On top of the fine of $650,000, the respondent has agreed to a censure and an undertaking to revise its written supervisory procedures regarding the over-reporting of Treasury transactions eligible for TRACE reporting.