Written on: 30 May 2022


  • Updated research shows historical forms of misconduct which have been present in the financial markets for hundreds of years, are playing out in new digital asset classes, including crypto assets and nonfungible tokens
  • Misconduct may also be found in new contexts, such as the sustainable finance market and the post-pandemic hybrid working environment
  • Financial Markets Standards Board highlights key patterns of behaviour at a time when government indebtedness and reliance on wholesale markets have never been greater

“History may not repeat itself. But it rhymes”

The Financial Markets Standards Board (“FMSB”) today publishes its Behaviour-pattern Conduct Analysis (“BCA”) report, a study of misconduct in global financial markets spanning over 200 years. This research looks at examples from 14 jurisdictions, selected from 28 countries across the world and multiple asset classes, and finds that market misconduct cases that have been seen for centuries still recur most frequently across six core behaviours.

The purpose of this study is to provide market practitioners with lessons from history to learn from and to give insights as to the steps that firms can take to help prevent those behaviours from occurring in a changing environment.

FMSB published its first BCA report in 2018 and this edition updates to include cases that have occurred between 2017 and 2021 and extends the number of jurisdictions to include France, Spain, Italy, Germany and the Netherlands. This updated analysis supports the same key conclusions of the original analysis, that:

  1. There are a limited number of patterns of poor behaviour and types of misconduct
    This study identifies that 19 types of misconduct, grouped across six simple behaviours (as shown in the table below), have been used to manipulate or distort markets and they repeat and recur over time.
  2. Misconduct is jurisdictionally, geographically and asset class neutral
    Misconduct is evident worldwide across global markets and is not specific to particular asset classes but occurs in all fixed income, currencies and commodities markets, and equity markets, as well as in new asset classes, including crypto and other digital asset markets.
  3. The six behaviours adapt to new technology and market structures
    Technology is not new – it has been a feature of markets for years, and as such there is a corresponding body of evidence of misconduct in the screen-based trading environment. 

The study also finds that historical forms of misconduct, such as price manipulation and circular trading, which have been present in the financial markets for hundreds of years, are playing out in new digital asset classes, including crypto assets and NFTs, and in new contexts, such as the sustainable finance market and the post-pandemic hybrid working environment.

Rapid advances in, and growing access to, new technologies and social media platforms are making traditional misconduct, like bull and bear raids, easier to facilitate (spurring the increasing occurrence of “meme stocks”) while simultaneously facilitating the detection of market manipulation by regulators.

The nature of regulation also tends to be reactive, introduced after problems are identified, rather than pre-emptive. This may be exacerbated by the pace of innovation in wholesale markets, with very rapid product and market development cycles.

This may be why, despite the introduction of new laws and regulations, patterns of behaviour driving misconduct seen for decades, and even centuries, still recur.

At the same time, these developments are taking place alongside a growing global regulatory emphasis on individual accountability, meaning regulators will have increased powers to hold senior individuals responsible for poor conduct in their business lines, potentially deterring some of the misconduct discussed in this analysis.

Myles McGuinness, CEO of FMSB said: “Government indebtedness and reliance on wholesale markets have never been greater post-pandemic. Our members know that integrity matters now more than ever, no matter how adept artificial intelligence is at spotting misconduct, it can also be a tool for creating it.

“This work remains as relevant as ever in today’s rapidly evolving environment in which market participants are grappling with a raft of the same conduct challenges in new settings. The wholesale financial services industry is arguably better equipped than ever to reduce future misconduct through the development of more effective controls, assisted by advances in behavioural science and a broader mindset shift.

“This research is also an exercise in the collation and analysis of market misconduct for the purposes of recognition, and to support, among other things, management oversight, training and control function oversight. We simply wanted to find out what can be learned from past episodes of market misconduct to pre-empt conduct problems that may arise in the future.”

David Flowerday, Chair of the FMSB BCA Committee and Head of EMEA Markets and Securities Services Compliance at Citi said: “We hope this piece of research will be a valuable reference point for wholesale financial market participants.

“This analysis highlights the repetitive nature of financial market misconduct over an extended time period. Given the pace of innovation and change, the intention is that market practitioners can use the BCA framework, supported with illustrative case studies, to inform their business practices, help eradicate poor behaviours, and continue to build trust in financial markets.”


Media contacts


Freddie Barber

+44 207 379 5151



Vic Silverman



Notes to Editors

A not-for-profit, privately-owned company, Financial Markets Standards Board (FMSB) is the leading market-led, global standards body for fair and effective wholesale financial markets.

Created following the Fair and Effective Markets Review (FEMR) in 2015, FMSB brings together its members – practitioners – from buy-side, sell side, corporate issuer and infrastructure provider organisations to develop Standards, Statements of Good Practice and Spotlight Reviews.

Its mission is to improve the transparency, fairness and effectiveness of global wholesale financial markets.

Recent posts: