The Australian Securities and Investments Commission (ASIC) on Wednesday imposed additional conditions on the Australian financial services licence of Macquarie Bank, owned by Macquarie Group, citing numerous serious compliance failures.
The bank’s compliance shortcomings, some of which remained unnoticed for a decade, pertained to its futures dealing business and its over-the-counter (OTC) derivatives trade reporting, according to the ASIC.
The regulator’s new conditions require Macquarie to prepare a remediation plan to address these failures and their root causes, enlist an independent expert to review and report on the remediation plan’s sufficiency, and have the independent expert assess the effectiveness of Macquarie’s remediation activities.
Shares of Macquarie Group were down 0.5% by 0041 GMT, compared to a 0.1% uptick in the benchmark S&P/ASX 200 index.
“Our intervention underscores our concern with the recurrent nature of Macquarie’s failures, which were caused by ineffective supervision and weak compliance and control management,” the ASIC Commissioner Simone Constant said.
Constant added that the ASIC was “particularly disappointed” as the company failed to prevent 11 suspicious orders being placed on the electricity futures market via their terminals shortly after the regulator referred similar failures to the Markets Disciplinary Panel, which fined the bank just under $5 million back in September 2024.
The new licence conditions were set after the ASIC identified nine market conduct matters of concern in the last 18 months, it said.
The ASIC said these included seven matters relating to misreporting of over 375,000 OTC derivative transactions, and two futures dealing matters concerning the prevention and detection of suspicious trading activity and the withholding of orders on the ASX24 market.
Macquarie acknowledged the ASIC’s announcement and said it has cooperated with the regulator and consented to the licence conditions.
Macquarie is slated to report its full-year earnings results on Friday, May 9.
