FCA Fines DMBL Over CFD Surveillance Failure

The UKs Financial Conduct Authority has fined Dinosaur Merchant Bank Limited £338,000 after finding that the firm failed to maintain effective systems for detecting and reporting suspicious activity in its CFD business. According to the regulator, the weakness was serious enough to leave a large block of trading outside automated surveillance.

What went wrong

The issue began after DMBL introduced a new order system in June 2024. Client CFD activity then rose sharply, and between June and October 2024 the platform processed trades with an underlying asset value of about $3.05 billion. The FCA said those orders and trades were not captured or reviewed by the firms automated monitoring setup, creating a gap in its ability to identify possible market abuse.

The firm identified the problem in October 2024, but the deficiencies were not properly fixed until May 2025. In the FCA‘s view, that delay materially weakened the firm’s ability to spot and escalate potentially suspicious trading during that period.

Why the case matters

This was not framed as a pricing issue or a product issue. The core problem was the disconnect between trading activity and compliance surveillance. When order flow expands or systems change, monitoring tools are expected to keep pace. In this case, the watchdog concluded that they did not.

The FCA said firms dealing in CFDs, given the nature of the product, must have reliable surveillance arrangements in place to help prevent insider dealing and market manipulation. It also noted that market-abuse controls are a basic part of maintaining fair and orderly markets.

Fine reduced after cooperation

DMBL received a 30% discount on the penalty because it cooperated fully with the investigation. Without that reduction, the fine would have been £482,900. The FCA also said the firm stopped selling CFDs in May 2025.

The regulator added that the case moved from opening to public outcome in nine months, which it presented as part of its effort to speed up enforcement work.

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