SIX Swiss Exchange fines Dresdner Bank AG London Branch Mar 12, 2009 URL: http://www.advancedtrading.com/showArticle.jhtml?articleID=215802061
The SIX Swiss Exchange today said that Dresdner Bank AG's London branch violated its rules related to reporting of off-order book transactions, and imposed a fine of 100,000 Swiss Francs (CCH) on the bank, or more than $84,0000 (USD). The exchange also ordered for the sanction to be published.
According to the exchange, Dresdner AG London Branch programmed its computer system in a way that off-order book transactions with a countervalue of at least the minimum as specified by the SIX Swiss Exchange were automatically designated with the B5 code, indicating that trades are to be published delayed. There were five cases in the span of two months in 2008 in which a delayed publication by five days was caused without having consulted with SIX Swiss Exchange in advance. Two of those transactions had a volume of CHF 213 million and CHF 190 million.
In the release, the exchange cites Article5 of the Swiss Federal Act on Stock Exchanges and Securities Trading (SESTA), which concerns publication of all information necessary for transparency in securities trading, including volume of securities. Participants of SIX Swiss Exchange must immediately report all off order transactions so that the exchange can also publish those trades, as well as the on-order book trades. There are certain instances in which a participant can have off-order book transactions published delayed by two trading days if the requirements of SIX Swiss Exchange directive 11 are cumulatively fulfilled: the conditions are as follows: the transaction must be in equities, have a specified minimum size and lead to the opening of a nostro position. In certain cases and with consultation with the exchange, trades may be delayed by five trading days. Such trades whose publication is delayed have to be published with a special code (B2 or B5).
According to the exchange, if a participant violates those rules, the Sanction Commission of SIX Swiss Exchange may impose a sanction, taking into account the gravity of the offense and the degree of fault. A fine was issued previously against Dresdner Bank AG London Branch due to the breach of securities exchange regulations previously. "Despite that fine, another violation took place," stated the exchange in the release. In addition to the new fine (CHF 100,000), the costs of the proceedings of CHF 16,000 ($13,443 USD) have been charged to Dresdner's London branch.