SEC Charges UK Security-Based Swap Dealer with Violating Laws for Dealing in U.S. Markets

ADMINISTRATIVE PROCEEDING
File No. 3-22504

August 6, 2025 – The Securities and Exchange Commission today announced settled charges against MUFG Securities EMEA plc, a security-based swap dealer (“SBSD”) located in the United Kingdom and registered with the Commission as an SBSD, for repeatedly violating certain SBSD capital recordkeeping, financial reporting, compliance, internal supervision, and internal risk management requirements of the Exchange Act and rules thereunder.  

According to the Commission’s order, when MUFG Securities EMEA conditionally registered as an SBSD in 2021, it elected to comply with certain provisions of the Exchange Act and certain rules thereunder by following the requirements of an SEC-issued substituted compliance order for UK-regulated firms. It did not, and accordingly, the firm was required to comply directly with the SBSD capital recordkeeping, financial reporting, compliance, internal supervision, and internal risk management requirements of the Exchange Act and Rules thereunder. MUFG Securities EMEA failed to comply with these requirements from November 2021 to October 2024.

According to today’s order, MUFG Securities EMEA did not compute its net capital in accordance with the Exchange Act or create the required records documenting those net capital calculations. It failed to make certain financial disclosures publicly available on its website and failed to submit to the Commission annually a compliance report containing a description of any areas for improvement to its compliance program as well as any material non-compliance matters identified, which includes weaknesses in the design or implementation of the policies and procedures relating to its business as an SBSD. MUFG Securities EMEA also failed to take reasonable steps to address non-compliance issues. It did not establish, maintain, and enforce written policies and procedures that were reasonably designed to prevent it from failing to satisfy certain conditions of the substituted compliance order or establish and enforce internal systems and procedures to obtain any necessary information to perform certain functions required by the Exchange Act. MUFG Securities EMEA also failed to establish a robust and professional risk management system adequate for managing its business. Moreover, in its application for registration as an SBSD filed with the SEC, MUFG Securities EMEA made untrue statements concerning its policies and procedures.

Without admitting or denying the SEC’s findings, MUFG Securities EMEA has agreed to pay a $9.8 million penalty and engage in undertakings related to a compliance consultant’s comprehensive review of its security-based swap dealer compliance program.

The SEC’s investigation was conducted by Matthew T. Connelly of the Chicago Regional Office and supervised by Anne Graber Blazek and Eric Werner of the Complex Financial Instruments Unit.