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20-066MR AMP Life and AMP Capital pay penalties in relation to trade reporting rules
AMP Life Limited (AMP Life) has paid a penalty of $275,500 and AMP Capital Investors Limited (AMP Capital) has paid a penalty of $250,500 to comply with infringement notices issued by ASIC.
ASIC issued the infringement notices as it considers there are reasonable grounds to believe there were breaches of the ASIC Derivative Transactions (Reporting) Rules 2013 (ASIC Rules) by AMP Life between August 2015 and February 2018 and by AMP Capital between March 2016 and September 2018.
ASIC Rules require counterparties to report derivative transaction and position information to derivative trade repositories. This reporting is necessary to enhance the transparency of transaction information available to regulators, promote financial stability and support the detection and prevention of market abuse.
Specifically, ASIC has reasonable grounds to believe that between 31 August 2015 and 26 February 2018, AMP Life failed to:
- report information about 940 transactions on 113 separate business days;
- correctly report collateral information about 9,224 transactions on 388 separate business days; and
- take all reasonable steps to ensure that BNP Paribas Fund Services Australasia Pty Ltd (BNP), on behalf of AMP Life, was reporting information that was complete, accurate and current.
ASIC also has reasonable grounds to believe that between 31 March 2016 and 28 September 2018, AMP Capital failed to:
- report information about 140 transactions on 34 separate business days;
- correctly report collateral information about 9,999 transactions on 417 separate business days; and
- take all reasonable steps to ensure that BNP, on behalf of AMP Capital, was reporting information that was complete, accurate and current.
ASIC considers that the breaches arose out of administrative failings. However, the duration of each of the reporting failures was significant and the time taken to identify them shows serious inadequacies in AMP Life's and AMP Capital's processes and procedures for monitoring the accuracy of their reporting.
AMP Life and AMP Capital have taken, and are continuing to take, actions to remedy their reporting failures and are implementing systems and processes aimed at preventing future failures of this kind.
ASIC Commissioner Cathie Armour said, 'the infringement notices issued to AMP Life and AMP Capital are a message to reporting entities to ensure compliance with their reporting and monitoring obligations under the ASIC Rules.'
Compliance with the infringement notices is not an admission of guilt or liability and AMP Life and AMP Capital are not thereby taken to have contravened the ASIC Rules.
ASIC issued the infringement notices as it had reasonable grounds to believe that AMP Life and AMP Capital contravened subrules 2.1.1(1), 2.2.3(1) and rule 2.2.6 of the ASIC Rules.
Subrules 2.1.1(1) and 2.2.3(1) of the ASIC Rules require reporting entities to report information about each relevant transaction generally by no later than the end of the next business day after entry into the transaction.
Rule 2.2.6 of the ASIC Rules requires reporting entities to take all reasonable steps to ensure the information reported under subrule 2.2.1(1) is and remains, at all times, complete, accurate and current.