“Macquarie continues to invest in a broad range of programs to further improve systems and controls.”
The misreporting of short sales is not the only serious regulatory issue that has dogged Macquarie recently and led to questions about its corporate governance.
In April last year, the Federal Court hit Macquarie Bank with a $10 million fine over its failure to implement effective controls to prevent and detect unauthorised fee transactions on customer cash management accounts.
In September last year, ASIC’s Markets Disciplinary Panel (MDP) fined Macquarie Bank a record $5 million for failing to prevent suspicious orders being placed on the electricity futures market.
This May, ASIC imposed additional conditions on Macquarie Bank’s financial services licence after multiple and significant compliance failures relating to its futures dealing business.
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It triggered a humiliating first strike against its remuneration report in July as investors retaliated at the lack of repercussions when it came to executive pay.
Macquarie chairman Glenn Stevens, who is a former governor of the Reserve Bank, told investors at its July AGM that the board holds staff accountable.
He said pay penalties were imposed on various executives last financial year in response to ASIC’s imposition of licence conditions on the group.
The pay impacts of the ASIC short-selling legal action would be imposed in the current financial year, Stevens said.
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Macquarie acknowledged the fine in an announcement on Friday, saying it was investing in programs to improve its systems and controls.
“Macquarie seeks to uphold the highest standards in meeting the expectations of markets and regulators and recognises the role of transaction reporting in market confidence,” it said.
Macquarie is not the only Australian financial giant facing repercussions from recent misconduct.
On Friday, the Federal Court ruled to increase the fines imposed by ASIC on ANZ for multiple cases of misconduct over the past few years, with Justice Jonathan Beach increasing the penalties by $10 million to a total of $250 million.
The increase related specifically to ANZ’s “unconscionable” management of a $14 billion bond trading deal. The judge said the additional fine was due to the bank’s “false reporting of secondary market bond turnover”. The penalties for the bank’s other three instances of misconduct remained unchanged.
