Gain Capital UK Limited

On 20 January 2011 the FSA imposed a financial penalty of £490,000 on City Index Limited in respect of breaches of FSA rules set out in chapter SUP 17 of the FSA Handbook and breaches of Principles 2 and 3 of the FSA's Principles for Businesses which occurred between 5 November 2007 and 21 September 2009 (the Relevant Period). In breach of SUP 17 City Index failed to submit accurate transaction reports in respect of nearly 60% of its reportable transactions, in that it failed to report approximately 55,000 transactions and it reported approximately 1,970,000 transactions with one or more data fields completed improperly. City Index also breached Principle 2 by failing to conduct its business with due skill, care and diligence through failing to identify fundamental errors in its transaction reporting process upon the implementation of a new trading platform, and Principle 3 by failing to take reasonable care to organise and control its affairs responsibly and effectively in relation to transaction reporting, in that throughout the Relevant Period, it failed to have in place adequate transaction reporting processes and procedures to ensure that it was fully compliant with requirements under SUP 17.