Australian Securities & Investments Commission asks NSW Supreme Court to impose AUD 35 million penalty on Macquarie Securities for short sale misreporting

The Australian Securities & Investments Commission (ASIC) has published agreed facts in civil penalty proceedings in which Macquarie Securities (Australia) Limited (MSAL) admits misleading conduct arising from systemic failures that led to incorrect short sale reporting over multiple years. ASIC and MSAL will ask the New South Wales Supreme Court to impose a civil penalty of AUD 35 million and make other orders, subject to the Court’s approval. MSAL admits it failed to correctly report at least 73 million short sales between 11 December 2009 and 14 February 2024, with total misreporting estimated at between 298 million and 1.5 billion short sales, driven by multiple systems and process failures that in some cases went undetected for more than a decade. It also admits shortcomings in supervisory policies and procedures, organisational and technical resources, and risk management systems to ensure compliance with short sale reporting obligations, and admits incorrectly reporting regulatory data for more than 633,000 orders between 16 November 2022 and 21 March 2023. The admitted contraventions include breaches tied to the ASIC Market Integrity Rules (Securities Markets) 2017 and Corporations Act provisions including misleading or deceptive conduct and risk management requirements. The proposed penalty and any additional orders will take effect only if and when approved by the Court.