The FCA has issued a Final Notice to the former Chief Supply Chain Officer at Wizz Air Holdings plc for breaches of the Market Abuse Regulations (MAR). This Notice, dated 26 November 2024, outlines significant regulatory failings conducted by the Wizz Air employee and the resulting penalties.
Background
The now former Wizz Air Chief Supply Chain Officer was a senior executive with access to confidential information. As a person discharging managerial responsibilities, defined under MAR as a senior executive who has “regular access to inside information relating directly or indirectly to that entity and power to take managerial decisions affecting the future developments and business prospects of that entity”, he was required to comply with strict regulations regarding the disclosure and timing of his personal trades in Wizz Air shares.
Breaches of MAR
In the Final Notice, the FCA sets out two primary breaches of MAR:
- Failure to notify transactions:
Between April 2019 and November 2020, the former Chief Supply Chain Officer conducted 115 transactions in Wizz Air shares without notifying the company or the FCA within the required three business days. This failure to disclose his trades prevented Wizz Air from making timely market announcements, violating Article 19(1) of MAR.
- Trading during closed periods:
The former Officer had also breached Article 19(11) of MAR by trading during “closed periods”, i.e. 30 days before the announcement of Wizz Air’s interim or year-end financial reports, on 18 occasions. These trades were conducted without seeking prior authorisation from Wizz Air’s Chief Corporate Officer, further compounding the regulatory breaches.
Penalties and wider implications
The FCA, having identified the trading through its market intelligence sources, imposed a financial penalty of £123,500, after a 30% discount for early settlement. Whilst no other sanctions were imposed by the FCA, there are clear personal reputational issues for the former Chief Supply Chain Officer and was dismissed by Wizz Air after investigation when the matter was brought to its attention by the FCA. The FCA’s decision underscores the importance of adhering to market abuse regulations and the serious consequences of non-compliance.
This case highlights the critical role of transparency and timely disclosure in maintaining market integrity. It serves as a reminder to all senior executives and people discharging managerial responsibilities of their obligations under MAR. The FCA’s enforcement actions aim to deter similar misconduct and reinforce the cruciality of regulatory compliance.
How can Complyport help?
This case is a clear example of the FCA’s commitment to upholding market integrity and protecting investors. It highlights the importance of maintaining compliance with financial regulations in order to protect your business and its reputation.
Complyport can help your firm establish a robust compliance framework that safeguards your business and fosters a culture of transparency and trust, by providing:
- Regulatory Guidance: helping your firm understand its regulatory obligations and providing expert advice on the relevant regulatory requirements;
- Documentation Updates: assistance in drafting appropriate policies and procedural documents;
- Ongoing Support: providing ongoing support to ensure that your firm remains compliant as regulations evolve;
- Training: providing training sessions to educate staff on the practical requirements and best practices for compliance.
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