The FCA has fined investment provider Infinox Capital Limited £99,200 for failing to submit 46,053 transaction reports.

The fine would have been £141,800, but Infinox agreed to resolve the case at an early stage and qualified for a 30% discount on the penalty imposed

Infinox failed to submit transaction reports for single-stock contracts for difference (CFD) trades executed through one of its corporate brokerage accounts between 1 October 2022 and 31 March 2023.

Although Infinox identified its failure to submit these transaction reports following a third-party review, it did not proactively report the breach to the FCA, instead leaving the regulator to identify the discrepancy in transaction data independently.

The FCA said that the breach highlighted weaknesses in Infinox’s transaction reporting systems and controls for a high-risk investment product.

This is the first enforcement action against a firm for a breach of transaction reporting requirements since they became law under the UK Markets in Financial Instruments Regulation (MiFIR).

Under MiFIR rules, the FCA needs to receive complete, accurate and timely transaction reports in order to monitor, detect and disrupt market abuse effectively, it said.

Steve Smart, joint executive director of enforcement and market oversight, at the FCA said: “As a data-led regulator, it is vital that firms submit accurate and timely transaction reports, and promptly bring any failures to our attention. Infinox failed to do this, which meant market abuse could have flown under the radar and risked the integrity of the market.

"Our specialist teams constantly monitor market data in real time to track any signs of misconduct."

CFDs are derivative instruments that investors use to speculate on the rise and fall in the price of a wide range of assets without owning the asset itself. They are most commonly offered in the UK on an over-the-counter basis by firms acting as counterparty (that is, as principal) to the client’s trade.

They allow investors to gain indirect exposure to the price movements in an underlying index, single stock equity, commodity, FX pair, or cryptocurrencies. Single-stock CFDs therefore allow investors to speculate on the rise and fall in price of a single stock rather than an index or basket of stocks.