Julie Cooper – 2016 Parliamentary Question to the HM Treasury

The below Parliamentary question was asked by Julie Cooper on 2016-01-18.

To ask Mr Chancellor of the Exchequer, what steps the Government has taken to prevent predatory high-frequency trading.

Harriett Baldwin

It would not be appropriate for the Government to comment on any ongoing investigations. This is an operational matter for the FCA which is an independent regulator. I have transferred this question across to them and they will respond fully in due course.

The Government is clear that any attempted manipulation of any financial market is completely unacceptable. The integrity of the City matters to the economy of Britain, and that is why the Government is taking action at home, in Europe, and globally, to ensure that this behaviour is punished and that similar scandals cannot occur again.

The Government has taken a number of steps to strengthen financial regulation in the UK. These include introducing the Senior Managers and Certification Regime to provide for effective regulation of individual conduct and accountability in the banking sector. The Bank of England and Financial Services Bill, now before the House of Commons, will extend this regime to cover all authorised financial services firms, including dealers in securities and other non-banks which may engage in high-frequency trading (HFT).

The Government has supported the European Union (EU) Markets in Financial Instruments Directive 2 (MiFID 2), which from 2017 will alter the regulatory landscape in relation to automated trading including HFT. As part of this, HFT firms will be required to disclose information concerning their trading activities to their regulator in order to increase the regulatory supervision of these markets.