Merrill Lynch Equities paid a penalty of $65,000 in order to comply with an infringement notice given to it by the MDP.
The MDP was satisfied that a Merrill Lynch ‘designated trading representative’ entered an order for the sale of 6,985 Rio Tinto shares for one cent each, rather than one Rio Tinto share for $69.85.
“The execution of the Relevant Order resulted in a significant decrease in the price of RIO, which did not accurately reflect material information relevant to the price of RIO,” said ASIC.
“The price of RIO decreased by $69.99, or 98 per cent below the last price at which RIO had traded immediately prior to the entry of the Relevant Order,” said the regulator.
“The market for RIO varied significantly having regard to the market for RIO which existed immediately before and after the Relevant Order,” said ASIC.
ASIC acknowledged that Merrill Lynch identified the issue and took action to remedy the breach.
“The MDP had regard to Merrill Lynch's compliance history and noted that notwithstanding the inadvertent human error in this matter, it could not overlook this followed a series of compliance failures,” said ASIC.
“Merrill Lynch agreed not to contest the matter, thereby saving time and costs that would otherwise have been expended,” said the statement.
