FSA releases systems and controls questions on SG rogue trading incident
FSA publishes a commentary on the internal controls and systems banks should have in place with reference to the Société Générale (SG) rogue trading losses.
LONDON – The UK’s Financial Services Authority (FSA) has published a commentary on the systems and controls banks ought to have in place, in the aftermath of the Société Générale (SG) rogue trading incident.
The recommendations come in the latest issue of the FSA's Market Watch newsletter. After consultation with 50 of the largest trading banks in London there are 17 questions and recommendations for next steps for banks to make. These include front-office culture and governance; the use of suspense accounts; the quality of management information, both routine and outside normal parameters; in addition to lower level IT reforms to safeguard passwords and monitor system access controls.
The newsletter stresses that most banks have already instigated their own review processes to look into gaps in trading controls in addition to highlighting the incomplete nature of the FSA’s appraisal and the desire for further industry input.
The newsletter can be read in full on the FSA’s website:
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