Nordnet, a pan-Nordic digital platform for savings and investments, today confirmed that it is investigated by the Swedish Financial Supervisory Authority (SFSA). The Swedish regulator has decided to open a sanction case against the company as a continuation of the previously initiated investigation regarding internal governance and control in relation to EU’s short-selling regulation.

The background to the case is the short-selling transactions carried out by customers of Nordnet in Moment Group AB in February 2021. The SFSA notified Nordnet of an investigation regarding Nordnet’s internal routines and processes for short selling. Since then, a site visit has been carried out, and the SFSA have requested and received written material.

The SFSA have today notified Nordnet that a sanction case will be opened, which is part of the SFSA’s investigation process. A sanction case means that the SFSA consider that there are sufficient grounds for assessing whether the observations made in the investigation should lead to a sanction, or if the investigation should be closed in any other way.

The next step is that the SFSA will send a letter to Nordnet in which the SFSA describe their observations and explains the legal basis that they consider give reason to consider a sanction. Such a letter will be sent to Nordnet in the beginning of next year, and Nordnet will have the opportunity to share their opinion on the matter.

Johan Tidestad, Chief Communications Officer at Nordnet, comments:

“The background to this case is the trading with shares in Moment Group in February, which was very special. The company made a share issue with complex terms, which the market had difficulties in interpreting. The share was perceived as incorrectly priced on the stock exchange with high volatility and intense trading as a result.

In addition, several trading halts took place during the day. Some of our customers held short positions during the day in Moment Group, and in connection with this, we realized that we needed to review our processes regarding short selling to ensure coverage of short positions in all situations, which we also informed the SFSA about.”