ICE Fee Plan, U.K. Money Laundering, Sarao Delay: Compliance

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Intercontinental Exchange Inc., owner of the New York Stock Exchange and some of the world’s biggest derivatives markets, plans to generate income by licensing patents and boosting market-data fees, a move that may clash with customers.

The company has asked its biggest customers what they’re willing to pay for licenses to trading-technology patents it bought a year ago, according to executives at four trading firms who asked not to be named because the discussions are private. ICE proposed to one company that it would waive the licensing fee if it directed stock transactions to the NYSE, which has seen its share of the equities business dwindle, instead of rival exchanges, an executive at the trading firm said.

“While some firms already have the legal right to use the patent and others have proposed licensing terms to us, we have not made any proposals at this time,” Kelly Loeffler, an ICE spokeswoman, said in an e-mailed statement. She denied that the exchange has told customers it would waive patent fees if they traded exclusively at the NYSE.

ICE bought the New York Stock Exchange in 2013. Years of regulatory changes have weakened NYSE’s near-monopoly on the trading of the companies it lists, helping competitors like Nasdaq OMX Group Inc., Bats Global Markets Inc. and dozens of other venues pull business away.

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Compliance Policy

U.K. Looks to Relax Money Laundering Rules to Help Businesses

The U.K. government said it will look at relaxing anti-money laundering controls as part of a plan to save British companies 10 billion pounds ($15.4 billion) over the next five years.

Britain will look at ways to make the rules designed to block terrorists and criminals from using the financial system more efficient and effective, the Department for Business, Innovation and Skills said in a statement on Friday. The government said it wants to protect the country without putting “disproportionate burdens” on legitimate businesses.

The review is one of six the government will run as part of plans to streamline rules over the next five years. It will look at the implementation of legislation by Britain’s Financial Conduct Authority and tax office.

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Compliance Action

Six U.K. Teenagers Arrested in Website Attacks on Amazon, Sony

Six British teenagers were arrested for allegedly using hacker-for-hire services in an attempt to take down corporate websites.

The operation targeted users of an online service called Lizard Stresser, which offered to carry out “denial of service” attacks in exchange for bitcoins, the U.K. National Crime Agency said. Among the companies hacked were Inc., Microsoft Corp. and Sony Corp., according to a person familiar with the investigation.

The service was created by a hacking group known as Lizard Squad, the agency said. Lizard Squad claimed responsibility for disrupting Microsoft’s Xbox and Sony PlayStation online services on Christmas Day.

Cybercriminals are selling increasingly sophisticated viruses and hacking services online while police are hampered by the use of cryptocurrencies and anonymous servers to avoid detection.

The arrests took place from Aug. 24 to 27.

U.K. spokesmen for Sony and Amazon didn’t immediately respond to e-mails seeking comment. Microsoft declined to immediately comment.

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‘Flash Crash Trader’ Sarao Fails to Delay Extradition Case

Navinder Singh Sarao, the trader charged over his role in the 2010 U.S. flash crash, lost a bid to delay extradition proceedings next month.

Sarao, who is subject to strict bail conditions, asked a London judge for more time to prepare an expert report on trading. The judge rejected the request, saying the issue was irrelevant to the question of extradition.

The 36-year-old Sarao was arrested in April in London and charged by U.S. prosecutors with fraud and market manipulation. Authorities said he was responsible for one in five sell orders during the frenzy on May 6, 2010, when investors saw almost $1 trillion erased from U.S. stocks in minutes.

Sarao’s lawyer argued that expert evidence was needed to show whether Sarao had made false representations through his trading. Judge Quentin Purdy said that was a question for trial. For purposes of extradition, the focus is whether the U.S. charges would also be offenses under U.K. law, Purdy said.

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