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ASIC takes stockbroker to court

ASIC has commenced civil penalty proceedings against Perth-based State One Stockbroking after it failed to comply with an infringement notice issued by the Markets Disciplinary Panel.


State One received an infringement notice in March 2016 after the Markets Disciplinary Panel (MDP) was satisfied that in March 2011 the firm had made bids on behalf of a client where “it ought reasonably have suspected” the orders were made to create a misleading appearance “with respect to the market for, or price of, a stock.”

Additionally, the MDP believed State One had “failed, between 10 February and 9 May 2011, to provide clear guidance to its employees responsible for reviewing post-trade alerts on what to do in the event of receiving post-trade alerts”.

State One was issued with a fine from the MDP for each of these contraventions, the cumulative value of which was $425,000, but has not complied with either.

ASIC noted that these infringement notices are “only an allegation” that State One has contravened the Corporations Act, and while the fine is not enforceable, ASIC has chosen to bring the penalty proceeding against the firm instead.

“Since August 2010 the MDP has issued 51 infringement notices in relation to alleged contraventions of the market integrity rules of which 50 have been complied with, the remaining notice being that issued to State One,” the regulator said.

 

 

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