‘Leaks and rumours’: UK regulator flags perils of bankers working from home
29 May 2020

Bankers working from their kitchens or bedrooms may raise new risks around handling sensitive information, meaning financial firms must check if their surveillance systems can spot suspicious transactions, British regulators said on Wednesday.

Since mid-March, many stock and bond traders have been working from home or back-up sites due to the COVID-19 pandemic as offices stand largely empty in central London.

At the same time, many listed companies are expected to tap stock and bond markets for funds to stay in business as the lockdown tips Britain into a deep recession.

Banks and brokerages must be aware that their employees working from home raises new, additional risks around identifying and handling inside information on capital raisings, the Financial Conduct Authority (FCA) said.

“Given market uncertainties and changed working arrangements, issuers need to be extra vigilant about the possibility of leaks and rumours, and identify whether there has been a breach of confidentiality,” it said in a bulletin.

“During this period, we encourage a particular focus on maintaining robust market surveillance and suspicious transaction and order reporting by relevant market participants.”

Misconduct could undermine investors’ confidence and willingness to support companies raising new capital, and could also expose issuers to significant reputational risk, it said.

By Huw Jones, Reuters, 27 May 2020

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