A group of 11 day traders that were investigated for potential collusion by the U.K.’s Financial Conduct Authority (FCA) are offering to pay £1 million to a fund that supports low-income families, among other commitments to address competition concerns raised by the regulator.
Following an investigation, the FCA said it’s concerned that the traders may have hampered competition in the commodity futures markets by sharing information, or coordinating their trading activity.
While the regulator hasn’t concluded that competition law was breached, or made any disciplinary allegations, the traders have proposed commitments to address the regulator’s concerns about market competition. This includes pledges to change how they handle confidential information, to complete continuing education on competition law, and to make a combined £1-million payment that would be given to a fund, the Crisis and Resilience Fund, which provides support to households facing financial hardship.
The FCA has provisionally decided to accept that offer, saying it believes these commitments will address its competition concerns — but it’s seeking comment on the proposal before it makes a final decision and closes its investigation.
“The financial commitment is likely to exceed any penalty the FCA could impose on the individuals following any infringement finding,” the regulator said, noting that the penalties that can be imposed under competition law are capped and that the law also provides for regulators’ concerns to be resolved by commitments that seek to address competition issues.
The proposal is now out for comment until July 14.
“Competition law exists to ensure markets work well. We consider all competition concerns and, where appropriate, we investigate and take action,” said Graeme Reynolds, director of competition at the FCA, in a release.