Yahoo Finance City watchdog reviews fraud claims at BGC Partners
The City watchdog is reviewing allegations of fraud and other regulatory breaches made by a whistleblower against the Wall Street broking behemoth BGC Partners.
The Financial Conduct Authority (FCA) has been in contact with international regulators and law enforcement after it was handed material by a former senior employee about alleged wrongdoing at BGC, according to documents seen by The Telegraph.
The regulator has also sought advice from independent experts to help it examine the claims. It is understood that the FCA has been looking into these allegations since at least 2019.
While the FCA declined to comment on the details of its inquiries, it is understood that at least two former senior employees have reported allegations of fraud, a lack of supervision and controls and whistleblower retaliation at the US broker.
The Telegraph understands that the FCA is not conducting an enforcement investigation into BGC at present and has not served the company with a memorandum of appointment of investigators, as it is required to do when it commences formal enforcement proceedings.
It is not known whether the watchdog has yet made any decision about the veracity of the allegations made against BGC.
BGC declined to comment.
BGC is headquartered in New York and employs over 600 brokers in Canary Wharf.
The disclosure comes weeks after it was fined nearly £5m by the FCA for failing to properly monitor its traders.
That sanction is understood to be unrelated to the allegations made by the former senior employees.
The regulator issued the fine after finding that between July 2016 and January 2018, BGC and two smaller companies it owns - GFI Brokers and GFI Securities - didn’t have proper processes in place to detect suspicious trading.
BGC is known for its annual charity day, when celebrities man its brokers’ phones and the proceeds of trades are donated to a fund for relatives of victims of the 9/11 terrorist attacks in New York.
Attendees of the event in London in previous years have included Prince William and Prince Harry, as well as former England manager Sam Allardyce.
Separately, in 2021, BGC accused London staff members of stealing $35m (£29m) to spend on property and jewellery in a claim filed in the High Court.
The broker, which acts as an intermediary between investment banks, said Michael Viney and Xavier Alcan allegedly funnelled cash due to or from HMRC to themselves between 2015 and 2020.
The two men deny the charges and are fighting the ongoing case in the High Court.
