Senior Consultant, The Netherlands
As Transaction Reporting regulations have become embedded, regulators have shifted focus from ensuring financial companies develop the required reporting infrastructure to examining quality control and the content of regulatory submissions. This is to be expected as otherwise data quality issues impede regulators from utilizing Transaction Reporting outputs to support their underlying regulatory objectives. This includes detecting instances of market abuse. Recent examples of this heightened regulatory focus include ESMA’s 2021 published ‘EMIR and SFTR data quality report 2020’, and an FCA 2020 published ‘Market Watch’, along with a range of recent regulatory enforcement fines relating to Transaction Reporting process deficiencies.
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This article sets out a set of quality control measures that institutions can adopt to meet regulatory expectations. It also highlights some challenges that institutions need to consider when approaching quality management objectives.