Macquarie Securities faces $35 million penalty bid over short sale reporting failures

Macquarie Securities (Australia) Limited has admitted to misleading conduct relating to the misreporting of millions of short sales over several years, which it attributed to repeated failures in its systems and processes. The Australian Securities and Investments Commission and Macquarie Securities will ask the New South Wales Supreme Court to impose a $35 million penalty and to make other orders against the firm, subject to the Court’s consideration and approval.

In a statement of agreed facts filed with the Court, Macquarie Securities admitted it failed to correctly report at least 73 million short sales between 11 December 2009 and 14 February 2024. It is estimated that Macquarie Securities misreported between 298 million and 1.5 billion short sales over the relevant period. The inaccurate reporting was attributed to multiple systems-related failures, many of which remained undetected for more than a decade.

Beyond the misleading conduct finding, the firm also admitted compliance control failures connected to its short sale reporting obligations. It admitted it failed to have appropriate supervisory policies and procedures, failed to have and maintain the necessary organisational and technical resources, and failed to have adequate risk management systems to ensure compliance with its reporting obligations.

Macquarie Securities also admitted it incorrectly reported regulatory data for more than 633,000 orders submitted to the market operator between 16 November 2022 and 21 March 2023. The regulator emphasised that accurate and reliable reporting data underpins confidence in financial markets, and that short sale and regulatory reporting data is relied on to understand market activity and support informed decision making, particularly during periods of volatility. The regulator stated that without accurate data, market transparency is undermined, and that market participants must maintain proper systems and processes to meet regulatory obligations.

The regulator’s action is presented as part of a broader program addressing misconduct and failures to comply with regulatory obligations by large Australian financial institutions. The regulator commenced civil proceedings against Macquarie Securities on 14 May 2025, described as its first short sale reporting case.

The admissions include contraventions of the Corporations Act 2001 linked to breaches of the ASIC Market Integrity Rules (Securities Markets) 2017, including failures relating to supervisory policies and procedures, organisational and technical resources, and provision of correct regulatory data to the market operator. The firm also admitted contraventions of Corporations Act provisions relating to adequate risk management systems and engaging in misleading or deceptive conduct in relation to a financial product.

Source: 25-311MR Macquarie Securities admits to misleading conduct and agrees to pay $35 million for systemic failures | ASIC