In the latest edition of Market Watch, the UK Financial Conduct Authority (FCA) discusses its observations and findings from its recent market abuse peer review into firms that offer Contracts for Difference (CFDs) and spread bets.
The FCA notes that CFDs and spread bets are particularly vulnerable to being used for insider dealing due to the speculative and leveraged nature of the products. They are a major source of Suspicious Transaction and Order Reports (STORs).
The regulator says it is also aware of a potential increase in a type of manipulative behaviour where spread bets and CFDs are being used to realise profits following manipulative practices in the underlying market via other firms.
To select the firms for the review,…
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