The FSA published its latest Market watch, which focuses on firms' reviews of their systems and controls in light of the Société Générale 'rogue trader' incident. The newsletter highlights the measures firms should consider when reviewing the systems and controls which protect them against 'rogue trader' risk.
“We would urge firms to remain vigilant on unauthorised trading, especially in current market conditions”, Sally Dewar of the FSA.
Amongst other areas, Market Watch looks at:
- Front office culture and governance, in particular are traders encouraged to take two-week continuous holidays, and appropriate segregation of front office staff from middle and back office functions;
- The use of suspense accounts;
- The quality of management information, both routine and outside normal parameters; and
- Elementary IT precautions, such as whether access to systems is password dependent.
Newsletter
© FSA - Financial Services Authority
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