The regulatory division of the Bourse de Montréal Inc. (MX) settled disciplinary charges with HSBC Securities (USA) Inc. over violations of its electronic access requirements.
Following a hearing, the exchange accepted a settlement with HSBC that saw the firm agree to pay an $80,000 fine and $5,622 in costs to resolve allegations that it violated certain rules of the exchange.
Specifically, the settlement addressed allegations that, between 2015 and 2019, the firm provided electronic access to the exchange’s trading system to eight of its employees without prior approval; and, that it didn’t have adequate policies in place to prevent those violations.
The breach, involving two employees, was initially discovered in a compliance review by the regulatory division of the MX. And, the firm discovered and self-reported violations involving six more employees.
“The issue was limited to a specific group of employees and caused by a gap in HSBC’s policies and procedures regarding Bourse approvals,” the settlement said.
It also noted that HSBC has revised its policies to address the gaps in its procedures concerning access to the Bourse — adding that the violations “appear to have primarily resulted from a lack of communication to its equities team, as opposed to a lack of commitment by HSBC to adhere to Bourse rules.”