On 17 October 2018, KPMG and FMSB hosted a breakfast event to explore FMSB’s Behavioural Cluster Analysis (“BCA”) research and publication.
To quote from The Fair & Effective Markets Review (“FEMR”) of 2015: “One of the Review’s most striking findings has been that, although the specific aspects of individual misconduct may have varied substantially across traders, firms and markets, the underlying behaviours were remarkably similar in many cases and relatively straightforward to describe”
In BCA FMSB identifies the twenty-five core behaviours which occur most frequently in market misconduct cases. BCA is based on a review of publicly available information set out in a large body of enforcement cases. The FMSB’s work demonstrates that these behaviours repeat and recur, are evident internationally, are evident across asset classes and adapt to new technologies and market structures. A number of different authorities and reviews, most recently the FEMR, have recognised the importance of focusing on the behavioural patterns underlying market misconduct. However, this is the first time that these patterns of behaviour have been collated, analysed and published as a single reference point for market participants.
At the event an expert panel, including members of FMSB’s BCA Committee who were instrumental in forming the work, discussed the FMSB BCA research.
Gerry Harvey – CEO, FMSB
David Flowerday – Chair, FMSB BCA Committee & EMEA Head of FICC Compliance, Citigroup Global Markets Limited
Dan Lavender – Partner in Litigation and dispute resolution at Macfarlanes
David Anders – Partner, Wachtell, Lipton, Rosen & Katz
Ian Boczko – Partner, Wachtell, Lipton, Rosen & Katz
Moderating the panel was Karim Haji, Head of Banking Risk and Regulation at KPMG.