IE 11 is not supported. For an optimal experience visit our site on another browser.

Canadian Regulator Levies Fine Against UBS

Canadian market regulators ordered UBS Securities Canada Inc. on Friday to pay a $1.6 million fine for inflating the number of shares it traded and failing to adequately supervise its trading floor.
/ Source: The Associated Press

Canadian market regulators ordered UBS Securities Canada Inc. on Friday to pay a $1.6 million fine for inflating the number of shares it traded and failing to adequately supervise its trading floor.

It's the largest-ever penalty of its type in Canada. No individuals were penalized at the Canadian subsidiary of the Swiss-based bank.

Market Regulation Services Inc., the independent regulation services provider for Canadian equity markets, found no indication that the so-called double printing of trades caused any harm or financial loss to clients, MRS agency counsel Jane Ratchford said.

However, the investment bank's actions did "affect the integrity of the marketplace by inflating volumes," Ratchford said.

The investigation focused on the Toronto stock market, and a UBS spokesman said after the hearing that there is no suspicion the violations extended to other markets where the global firm does business.

UBS is among the biggest-volume dealers on the Toronto Stock Exchange, although agency officials could provide no specific numbers on the inflated shares.

The double printing, conducted at least since early 2003, was done by such means as selling and buying securities out of UBS inventory instead of matching customer buy and sell orders, thus booking two trades on a transaction instead of one.

A lawyer for UBS, Nigel Campbell, concurred with Ratchford's presentation, stressing that the bank "takes this settlement extremely seriously."

In addition to the financial penalty, UBS must hire an independent consultant to certify by next June 30 that its supervisory and compliance systems comply with market regulations.