FCA MiFIR Fines Explained: Lessons From Recent Transaction Reporting Enforcement

The FCA has taken its first two enforcement actions under the UK MiFIR transaction reporting regime, marking a clear shift from supervisory messaging to regulatory sanctions. In recent cases involving Infinox Capital Limited and Sigma Broking Limited, the FCA imposed significant fines for transaction reporting failures that impaired its market abuse surveillance capabilities. Former FCA regulator Sophia Fulugunya analyses what went wrong and what these cases mean for firms subject to MiFIR reporting obligations.

Key Regulatory Insight

The FCA's first MiFIR enforcement actions show that transaction reporting failures - whether limited or systemic - are now a clear enforcement priority. Even where no market abuse occurs, weak testing, reconciliation, and governance can lead to significant penalties. Compliance teams should treat transaction reporting as a core regulatory control requiring continuous oversight.

The Cost of Getting It Wrong

Recent FCA MiFIR Fines and Lessons Transaction Reporting

The FCA's first two enforcement actions under the UK MiFIR transaction reporting regime provide a clear signal to firms: transaction reporting failures, whether limited or systemic, are now firmly within scope for enforcement.

While the fines differ significantly in scale, together they illustrate how the FCA assesses reporting failures, the factors that drive penalty levels, and the practical importance of effective testing, reconciliation, and governance.

For compliance professionals, these cases serve as useful case studies in how relatively common control weaknesses can escalate into regulatory action.

Case Study One: FCA Issues First MiFIR Fine

In January 2025, the FCA issued its first fine under the MiFIR transaction reporting regime, penalising Infinox Capital Limited £99,200 for failing to submit 46,053 transaction reports relating to single-stock CFD trades.

Although the number of missing reports was relatively modest, the FCA's rationale was clear. Transaction reporting is a core surveillance tool, and any failure that reduces the regulator's ability to monitor for market abuse is considered serious, regardless of whether actual abuse occurred.

Key observations from the FCA's decision included:

• The failure stemmed from weaknesses in reporting controls rather than a one-off operational error.
• The issue was identified internally, but not proactively disclosed to the FCA.
• The FCA emphasised the risk created by missing data, rather than demonstrable harm.

This case set an important precedent: enforcement action would be taken even where failures were limited in duration and scope.

Case Study Two: FCA Issues Second MiFIR Fine

Six months later, the FCA issued its second MiFIR fine, this time imposing a £1,087,300 penalty on Sigma Broking Limited. The scale of the fine reflected the seriousness of the failures: almost 925,000 inaccurate transaction reports submitted over a five-year period.

The root cause was an incorrect system configuration affecting multiple reporting fields. What escalated the issue was not just the error itself, but the absence of effective controls to identify it.

The FCA highlighted:

• Inadequate testing of transaction reporting logic.
• Weak or ineffective reconciliation processes.
• Poor governance and oversight of reporting obligations

The length of time the issues persisted was a significant aggravating factor. The FCA noted that basic validation and reconciliation controls should have identified the problem much earlier.

What the FCA's MiFIR Enforcement Actions Tell Us About Transaction Reporting

Taken together, these cases provide a clearer picture of the FCA's expectations around MiFIR transaction reporting.

Scale and Duration Drive Outcomes

Short-lived failures may attract enforcement; long-running, systemic inaccuracies will attract materially higher penalties. Issues allowed to persist over years are treated as governance failures, not technical oversights.

Transaction Reporting Is a Regulatory Control

The FCA continues to frame transaction reporting as central to its market abuse surveillance capabilities. Failures are therefore viewed as impairments to the regulators oversight, even in the absence of proven misconduct.

Detection Alone Is Not Sufficient

Identifying an issue internally does not, by itself, mitigate regulatory risk. The FCA expects timely escalation and transparency where material reporting issues are identified.

Static Systems Create Ongoing Risk

Both cases demonstrate the risks of set and forget reporting frameworks. System configurations, mappings, and assumptions must be subject to ongoing review, particularly as trading activity, products, and upstream systems change.

How Testing and Reconciliation Failures Led to FCA MiFIR Fines

In both enforcement actions, more robust testing and control frameworks could likely have reduced the impact or prevented the breaches entirely.

Examples include:

• Pre-implementation testing to validate reporting logic and field position
• Ongoing data validation and reconciliations to identify missing or anomalous reports
• Periodic thematic reviews to challenge long-standing assumptions about data accuracy
• Clear ownership and governance structures to ensure issues are escalated and addressed

These are not new expectations, but the FCA's enforcement actions demonstrate that failures to implement them now carry tangible consequences.

Conclusion

The FCA's first two MiFIR fines mark a shift from supervisory messaging to enforcement reality. For compliance professionals, the message is clear: transaction reporting accuracy must be actively tested, governed, and challenged on an ongoing basis.

As the FCA's use of data and analytics continues to mature, firms should assume inaccuracies will be identified. The cost of getting it wrong is no longer theoretical, and strong testing remains one of the most effective ways to avoid becoming the next case study.