MyComplianceOffice Blog

Conduct risk is a form of business risk that refers to potential misconduct of individuals associated with a firm, including employees, third-party vendors, customers or agents interacting with the firm. Read more on conduct risk, what regulators say about it and how to protect against it.

According to a 2019 survey financial institutions, especially banks, are falling behind when applying digital transformation to conduct risk management. The current situation shone a light on the lack of technology to monitor employees' activities, regulations, conflicts of interest and conduct risk across organizations. During the pandemic, risk and compliance departments were struggling to manage risks, provide reporting and comply with regulations. All that drove even more attention to the need for RegTech solutions in financial services.

ESMA published its annual report on December 21, summarising administrative and criminal sanctions and other measures imposed under the Market Abuse Regulation in 2019. A sum of 279 administrative sanctions and measures and 60 criminal sanctions were imposed for infringements of MAR in 2019. The total value of the penalties exceeds €88 million.

2020 was a different year, but some things never change. MCO once again hosted several webinars to update compliance and risk professionals on the latest regulations, enforcements and industry best practices. Here are some of the highlights of what we learned from our expert speakers in 2020.

The most recent FCA  newsletter on market conduct and transaction reporting issues, Market Watch 65, covers how the inappropriate handling of information requirements can compromise market abuse investigations. In addition, the document highlights data quality issues found on transaction reporting under the Markets in Financial Instruments Regulation.