Dubai’s DFSA fines brokerage $1.37m for failing to comply with regulatory requirements

The Dubai Financial Services Authority has actually enforced a fine of more than Dh5 million ($1.37 million) on brokerage RJ O’Brien Mena Capital for stopping working to abide by regulative requirements.

The fine was decreased from the initial Dh10.25 million because the company provided the authority an enforceable endeavor to remediate the failings and consented to settle the matter, the regulator of the Dubai International Financial Centre stated in a declaration on Friday.

The company likewise engaged an external compliance specialist to help and to confirm that the required removal has actually been finished.

“Authorised companies need to make sure that they have sufficient compliance and other resources to be able to abide by their legal and regulative responsibilities,” stated Patrick Meaney, head of enforcement at the authority.

“Compliance is not an incidental expense of working, it is an important function that needs to be effectively resourced in regards to both number and quality of personnel.”

RJO Mena is a totally owned subsidiary of JVMC Holding, a group holding business that runs in the United States, UK, EU, Middle East and Asia.

The group has a futures brokerage and cleaning company, consisting of a complete cleaning member of the Chicago Mercantile Exchange and all its markets, along with the marketplaces run by the Intercontinental Exchange Group in the EU and the United States.

The matter describes RJO Mena’s acquisition of LFS, another DFSA authorised company, which was started in 2020.

The authority stated it discovered the company “did not carry out adequate preparation and analysis to guarantee it might adhere to its continuous regulative responsibilities after obtaining an extra brokerage”.

“The company’s senior management knew the absence of compliance resources and stopped working to sufficiently resolve it to make sure that the compliance function had the ability to satisfy its regulative responsibilities,” it stated.

The authority stated it “did not discover any proof that the company acted intentionally to contravene DFSA administered laws and guidelines”.

It likewise stated the breaches happened throughout the Covid-19 pandemic, that made preparation and oversight of the LFS combination “more tough due to take a trip constraints avoiding travel by group staff members to Dubai”.

The authority has actually been punishing regulative non-compliance as part of efforts to preserve self-confidence and stability in the monetary services market in the DIFC. The regulator intends to lower systemic threat in the sector and avoid, identify and limit conduct that triggers or might trigger damage to the track record of the monetary center.

Upgraded: December 29, 2023, 11:07 AM