Credit Suisse Fined by ASIC for False Order

Equities arm Credit Suisse has been fined $95,000 by the disciplinary panel of the Australian Securities and Investments Commission after it was found to have failed to detect a “false order” in its trading system.

The panel said this has been the second offense by the company in relation to their automated trading platform. But aside from this, Credit Suisse has had a number of sanctions from the stock exchange since 2003.

On November 7, a trader apparently placed an incorrect price for a client, which in turn altered the stock market’s prices for that day. The panel insisted there was negligence on the part of Credit Suisse, and its consequences were potentially damaging to the integrity of the market.

In a statement released by the panel, it said:

“Credit Suisse did not self-report the breaches to ASIC and failed to inform both ASIC and the ASX in a timely manner.

“Any future, repeat contraventions in similar or comparable matters will not be viewed favourably.”

The false order involved 2.9 million shares of Hastie Group, a construction and engineering company. Credit Suisse’s system allegedly failed to record the company’s share price, which had changed earlier. The oversight resulted in an order that was at 47¢ when it should have been 51¢.

Credit Suisse is not contesting the fine and charges.

In a statement, the company said: “Credit Suisse responded promptly to this incident and has put in place necessary processes to help prevent a reoccurrence.”