Dubai Financial Services Authority (DFSA) has issued a fine to R.J. O’Brien (MENA) Capital Limited amounting to AED5,023,375 ($1,368,767) for numerous compliance breaches including having inadequate compliance systems and controls.
Initially, the fine issued was substantially higher ($2,793,403) however, the amount was reduced following an Enforceable Undertaking (EU) offered by the firm to remediate the failings and agreeing to settle the matter.
The DFSA found the following:
- The firm did not undertake sufficient planning and analysis to ensure it could comply with its ongoing regulatory obligations after acquiring an additional brokerage; and
- The firm’s senior management were aware of the lack of compliance resources and failed to adequately address it to ensure that the compliance function was able to fulfil its regulatory obligations.
It was clarified that the DFSA did not find any evidence that the breaches were committed deliberately.
As per the EU provided by the firm, it agrees to:
- Remedy the deficiencies in its systems and controls and compliance resources; and
- Engage an external compliance expert to assist the Firm in complying with its obligations and to verify that the necessary remediation has been completed.
Patrick Meaney, Head of Enforcement of the DFSA, said: “Authorised Firms must ensure that they have adequate compliance and other resources to be able to comply with their legal and regulatory obligations. Compliance is not an incidental cost of doing business, it is a critical function that must be adequately resourced in terms of both number and quality of staff.”
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