JPM Fined $800K for Surveillance Failure

Surveillance is a dilemma.

Busy?  Yea, us too.  It’s been a crazy couple of months. Besides MiFID II projects, BroadPeak is rolling out a whole bunch of new stuff at the end of summer!  More on that in a bit…

JP Morgan got fined $800,000 for trade surveillance failures.   There’s some commentary HERE and the actual settlement HERE.  While this was in equities, there are some important things that can be learned for the Commodities, FX and IR markets.  

Probably the big take away is that even in the equities markets, compliance personnel can easily get swamped with false positives.  It’s a surveillance catch 22, because if your are tempted to “turn the noise down” there is a real risk of missing something important.   Long story short, beware relying on the little black box.  Surveillance takes dedicated and ongoing analysis whether its wash trades, spoofing or whatever.   Don’t fall to the temptation to turn down your analysis.

On to the new stuff!


Like everyone else we are eagerly awaiting publication of the MiFID II commodity limits. K3 Limits already covers exchange limits but we’ve completed our development changes for MiFID II limits and expect we will be out of the gate with the most advanced solution nearly immediately after publication of the limits (expected in November).

Limits Training

In association with AIMA we will be running a Position Limits Training session next month (Sept 2017).  Keep your eyes open for an email invite.  If you want to get on the invite list shoot an email to with the header Position Limits.

MAR  Surveillance Compliance

A lot of firms are still behind on MAR.  If you are looking for a real time feed of your trades or order data, we’ve developed some technology that is literally plug and play.  I’d venture we could get just about any firm set up in less than a day.  Seriously, even if you are struggling getting CME or ICE feeds set up on your own …just give us a call.  We will talk you through the curve balls.

Project Codename: “X”

We’ve never talked publicly about project X, but this is a big one. K3 has always connected to exchanges for trades and orders.  It’s become a bread and butter part of K3’s offering.  But we’ve been making some changes to the K3 backbone that significantly changes the level of throughput and speed.  While K3 can manage and transform about 165,000 trades or orders per second using (standard hardware), we’ve made some changes that (on that same standard hardware) exceeds 1,000,000 trades and orders per second.  Why would we do this?  Oh, enter a cliche quote here about skating to where the puck will be.  So much more on this toward end of year.