WASHINGTON, Dec 21 (Reuters) - The U.S. brokerage watchdog
expects to soon file enforcement actions against a number of
inter-dealer brokerages or inter-dealer traders suspected of
collusion, a person familiar with the probe told Reuters on
Monday.
The Financial Industry Regulatory Authority, which supervises nearly 4,800 brokerage firms, has been investigating communications between the inter-dealer brokerages and brokers for months.
FINRA is looking at whether the inter-dealer brokers -- which match buyers and sellers in the over-the-counter markets -- are colluding with each other, the source said.
The source spoke on condition of anonymity because the source was not authorized to speak on the record.
In June, FINRA fined ICAP Corporates LLC, a unit of ICAP Plc, $2.8 million. It also sanctioned a former ICAP broker for 'improper' communications with other inter-dealer brokerages about customers' proposed brokerage rate reductions in the credit derivatives market.
The company's U.S. subsidiary, ICAP Securities USA LLC, last week agreed to pay $25 million to settle U.S. Securities and Exchange Commission charges it allegedly displayed fake trades to encourage trading by customers.
The SEC alleged that brokers on ICAP's U.S. Treasuries desks displayed thousands of fictitious flash trades on computer screens between December 2004 and December 2005.
ICAP is the world's largest inter-dealer broker.
(Reporting by Rachelle Younglai; editing by Andre Grenon) Keywords: INTERDEALERS INVESTIGATION (rachelle.younglai@thomsonreuters.com; +1 202 898 8411) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The Financial Industry Regulatory Authority, which supervises nearly 4,800 brokerage firms, has been investigating communications between the inter-dealer brokerages and brokers for months.
FINRA is looking at whether the inter-dealer brokers -- which match buyers and sellers in the over-the-counter markets -- are colluding with each other, the source said.
The source spoke on condition of anonymity because the source was not authorized to speak on the record.
In June, FINRA fined ICAP Corporates LLC, a unit of ICAP Plc, $2.8 million. It also sanctioned a former ICAP broker for 'improper' communications with other inter-dealer brokerages about customers' proposed brokerage rate reductions in the credit derivatives market.
The company's U.S. subsidiary, ICAP Securities USA LLC, last week agreed to pay $25 million to settle U.S. Securities and Exchange Commission charges it allegedly displayed fake trades to encourage trading by customers.
The SEC alleged that brokers on ICAP's U.S. Treasuries desks displayed thousands of fictitious flash trades on computer screens between December 2004 and December 2005.
ICAP is the world's largest inter-dealer broker.
(Reporting by Rachelle Younglai; editing by Andre Grenon) Keywords: INTERDEALERS INVESTIGATION (rachelle.younglai@thomsonreuters.com; +1 202 898 8411) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.