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The Dubai Financial Services Authority (DFSA) has levied a 1,850,940 million dirham ($504,000) fine on investment management and brokerage firm Ark Capital Management (Dubai) Limited for having inadequate market abuse systems and controls in place.
The financial services and markets regulator for DIFC also pulled up the firm for failing to notify the DFSA of a “proposed change in control”, stating that Ark systems had “failed to give adequate consideration” to alerts generated by its market abuse systems, and in some instances, “did not promptly review them”.
DFSA cited at least 10 instances of trading that were overlooked and not reported to the regulator or dealt with “in a timely manner”, some that were mistakenly considered by ARK as falling below the initial shareholding acquisition percentage.
“Structuring transactions to avoid the need for DFSA approval, such as staggering purchases into tranches that fall below percentage thresholds, does not absolve firms of their separate obligation to notify the DFSA of a potential change in controllers. This is especially true when there are agreements in place setting out a path that may result in a firm’s ownership changing,” Alan Linning, Managing Director, Enforcement, of the DFSA said.
(Writing by Bindu Rai, editing by Seban Scaria)
