Hong Kong's Securities and Futures Commission SFC has fined Merrill Lynch Asia Pacific Limited and Merrill Lynch Futures Hong Kong Limited HK$3.5 million $450,000 for systems and controls failings associated with mis-marking activities in a trading book.
A spokesman at Bank of America Merrill Lynch declined to comment.
The problems occurred from December 2007 to October 2008, shortly before Merrill was acquired in a shotgun wedding by Bank of America. An unidentified managing director at Merrill had mis-marked a trading book in exotic options by manipulating the volatility marks in the valuation model, and accessed the computer system without authority to alter pricing parameters on various occasions.
The mis-marking activities, which...
¬ Haymarket Media Limited. All rights reserved.
