A lack of internal controls and management oversight enabled improper trading at inter-dealer broker Tullett Prebon (Europe) Ltd., British regulators have found.

The U.K.’s Financial Conduct Authority (FCA) has fined Tullett Prebon £15.4 million for a variety of failings involving brokers in its rates division.

The FCA said an investigation found that the firm had poor controls over broker conduct between 2008 and 2010, which allowed trading misconduct.

“Lavish entertainment and a lack of effective controls allowed improper trading to take place, including ‘wash’ trades which generated unwarranted and unusually high amounts of brokerage for the firm,” the regulator said.

It found that the firm failed to conduct its business with “skill, care and diligence,” failed to have adequate risk management systems and wasn’t cooperative with the FCA.

“While these trades did not mislead the market, nor amount to market abuse, the wash trades were entirely improper, undermining the proper function of the market,” said Mark Steward, executive director of enforcement and market oversight at the FCA.

“Senior management and compliance were cocooned from seeing the misconduct, and systems and controls failed to probe broker conduct, even when warning signs were visible,” Steward said. “Senior management wrongly believed sufficient systems and controls were in place, when in fact, systems and controls were not used or directed effectively.”

The firm received a 30% discount on its fine for agreeing to resolve the case. Without the discount, the fine would have been £22 million, the FCA noted.