Life Trading Pty Ltd (‘Life Trading’) has paid a penalty of $200,000, and entered into an enforceable undertaking with ASIC, to comply with an infringement notice given by the Markets Disciplinary Panel (‘the MDP’).
The MDP had reasonable grounds to believe that Life Trading contravened Rule 2.2.8 of the ASIC Market Integrity Rules (Futures Markets) 2017 which requires a market participant to have appropriate supervisory policies and procedures to ensure compliance by the participant and each person involved in its business with the market integrity rules and the Corporations Act.
The MDP found that Life Trading did not have appropriate supervisory policies and procedures from the time it became a market participant on 28 January 2019 until 4 June 2020, a period spanning 17 months. The MDP found that Life Trading’s framework for the supervision of traders was under-resourced, uncoordinated and undocumented for that period. Life Trading’s compliance culture throughout the relevant period was lax, with minimal commitment to ensuring an appropriate supervisory framework was implemented. There was a lack of pro-active engagement in relation to supervisory compliance, with the drivers of meaningful change being primarily attributable to responding to ASIC’s investigation.
The MDP notes that Life Trading has gradually made a number of improvements to its supervisory and compliance procedures. Despite those remedial steps, the MDP still remains concerned about the appropriateness of Life Trading’s supervisory framework and, for that reason, the MDP required Life Trading to enter into an undertaking for an independent expert to review and provide a report on Life Trading’s supervisory framework following the improvements made to that framework.
The compliance with the infringement notice is not an admission of guilt or liability, and Life Trading is not taken to have contravened subsection 798H(1) of the Corporations Act.