The FCA has fined Dinosaur Merchant Bank Limited (DMBL) £338,000 for failing to put in place effective systems and controls to detect and report suspicious trading in its contracts for difference (CFD) business.
CFDs are sophisticated financial products that are used to speculate on various assets going up or down in value. Given their high-risk nature, firms must have strong and reliable surveillance arrangements to prevent insider dealing and market manipulation.
In June 2024, DMBL introduced a new order system that led to a sharp increase in CFD trading by its clients. Between June and October 2024, trades with a corresponding asset value of approximately $3.05 billion were executed via the platform. However, these orders and trades were not captured and reviewed by the automated surveillance system which meant that potential market abuse could have gone undetected.
Although DMBL identified this issue in October 2024, the firm failed to properly address the deficiencies until May 2025. The delay limited the firm’s ability to identify and report potentially suspicious trading.
Steve Smart, joint executive director of enforcement and market oversight, said:
‘DMBL’s failures had the potential to undermine the integrity of the market. Firms must ensure they have effective surveillance arrangements in place. We will continue to take action where this is not the case.’
DMBL fully cooperated with the FCA investigation and qualified for a 30% discount. Without this discount, the fine would have been £482,900. The firm stopped selling CFDs in May 2025. This case, taking just 9 months from opening to achieving a public outcome, demonstrates the FCA’s continued work to improve the pace of its enforcement investigations.
Notes to editors
- Final Notice: Dinosaur Merchant Bank Limited (PDF).
- DMBL breached Article 16(2) of the UK Market Abuse Regulations (UK MAR), SYSC 6.1.1R of the Senior Management Arrangements, Systems and Controls chapter of the FCA’s Handbook and Principle 3 of the FCA’s Principles for Businesses.
- Market abuse surveillance systems serve to protect the integrity of financial markets, foster investor confidence and ensure fair trading by detecting, preventing and reporting illegal activities like insider dealing and market manipulation. They enable firms to comply with regulations (eg, UK MAR and the Market Abuse Directive on Criminal Sanctions) by analysing trade data for suspicious behaviour, such as spoofing or front-running, to identify misconduct at an early stage.
- For further information on market abuse surveillance, read the FCA’s newsletter on market abuse surveillance and market abuse peer review into firms that offer CFDs.
- Find out more about the FCA.
Facts Only
Actor: Dinosaur Merchant Bank Limited (DMBL)
Actor: Financial Conduct Authority (FCA)
Event: FCA fined DMBL £338,000
Action: Failing to implement effective systems and controls to detect and report suspicious trading in CFD business
Timeframe: June 2024 - May 2025
Location: Not specified
Regulation breached: Article 16(2) of the UK Market Abuse Regulations (UK MAR), SYSC 6.1.1R of the Senior Management Arrangements, Systems and Controls chapter of the FCA’s Handbook, and Principle 3 of the FCA’s Principles for Businesses
Executive Summary
Full Take
Stepping back from this article, it's crucial to acknowledge that financial institutions have a responsibility to maintain robust surveillance systems to prevent insider dealing and market manipulation, particularly in high-risk products like CFDs. In this case, DMBL's failure to address deficiencies in their surveillance system for several months potentially allowed suspicious trading activities to go unnoticed. While the FCA's fine serves as a penalty, it also underscores the importance of strict oversight in financial markets.
Patterns detected: ARC-0024 Ambiguity (The article mentions that DMBL identified the issue in October 2024 but failed to properly address it until May 2025, leaving room for interpretation as to why the delay occurred)
In considering the implications of this situation, one might ask: What factors led to the delay in addressing the deficiencies? How does DMBL's failure to maintain effective surveillance systems impact investor confidence and market integrity? Furthermore, what measures are being taken by financial regulators to ensure similar lapses do not occur in the future?
Sentinel — Human
This text shows signs of being likely human-written. The analysis suggests some inconsistencies in sentence length variance but also presents a personal voice and idiosyncratic emphasis, which are typically absent in synthetic content.