via Keith Underdown comes this story hot off the press release engine in the UK’s Financial Services Authority.

Barclay’s Bank have been fined stg£2.45 million for “failing to provide accurate transaction reports to the FSA and for serious weaknesses in systems and controls in relation to transaction reporting”. The fine would have been higher (stg£3.5 million but for the fact that Barclay’s co-operated with the investigation and agreed to settle the matter quickly). According the the FSA press release

“Complete and accurate transaction reports are an essential component of the FSA’s market monitoring work. Barclays’ reporting failures could have a damaging impact on our ability to detect and investigate suspected market abuse.

“The penalty imposed on Barclays is significantly higher than previous penalties imposed for transaction reporting errors. This reflects the serious nature of Barclays’ breaches and is a warning to other firms that the FSA will not tolerate inadequate systems and controls.”

This is an interesting warning that serves as an indicator of how Regulatory systems and enforcement will be changing in a post-Recession world.

Of course, the true cost to Barclays is much greater than the cost of the fine. For one, there is the reputational damage that comes from being fined to this extent by the FSA. And then there is the cost of correcting errors and fixing the defective processes, which Barclays has done “including commissioning a review of its transaction reporting process and committing extensive resources to improve its processes and resolve the errors.”

Reviews and resources don’t grow on trees you know.

This is a clear example of an IQ Trainwreck.