The London Metal Exchange (LME) has been fined £9.2 million by the Financial Conduct Authority (FCA) for mishandling the nickel market during the chaos in March 2022, exacerbated by Russia's invasion of Ukraine. Prices skyrocketed, prompting an eight-day trading suspension and the controversial cancellation of trades. The FCA's investigation revealed the LME's operational deficiencies, primarily involving under-trained junior staff managing trading during critical hours without proper escalation protocols, leading to greater market volatility and elevated risks for investors.
The FCA found that the LME's operational failures during the nickel market chaos allowed for unchecked price surges, significantly increasing market risks for participants.
The regulator emphasized the inadequacy of LME's systems, noting junior staff were untrained and mismanaged trading, leading to severe market consequences during the crisis.
#london-metal-exchange #nickel-market #financial-conduct-authority #market-regulation #investment-risk
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