The Financial Services Authority (FSA) in the UK fined Martin Currie GBP3.5m while the fine imposed by the US Securities and Exchange Commission was GBP5.1m.
FSA said that the conflict of interest arose when Martin Currie caused one client (Fund B) to enter into an ill-advised transaction which rescued another client (Fund A) from serious liquidity concerns.
The regulator added that Martin Currie did not properly scrutinize the valuation or rationale of an approximately GBP15m bond investment it advised one of its clients, Fund B, to make in April 2009.
According to FSA, Martin Currie failed to ensure that the bond’s valuation or the rationale behind the investment were properly scrutinised at the time of the transaction, and it proved to be a poor investment for Fund B, halving in value over the next two years.
Martin Currie settled early with the FSA and received a 30% discount on its fine and without the settlement discount the fine would have been GBP5m.
