FCA looks into private polling from hedge funds
By Caoimhe Toman
Date: Wednesday 16 Jan 2019
(Sharecast News) - The UK financial watchdog is reviewing regulation over private political polling, which has been used by hedge funds to profit from events such as Brexit.
The Financial Conduct Authority is examining whether it has the power to intervene using insider trading and inside information regulations, or at least update its guidelines.
After the Brexit referendum it emerged that several hedge funds had commissioned private exit polls during the Brexit campaign that allowed the firms to cash in after the surprise result.
Although it is illegal for the public to receive exit-polling data while voting is underway, polling companies sold and streamed exit poll data to hedge funds throughout the day of the referendum.
The FCA already started to look into the use of private polls by hedge funds back in October, announcing that it would investigate the pollsters to see if market abuse had been committed.
Treasury committee chair Nicky Morgan said the sale of private polls to hedge funds put the integrity of UK financial markets at risk.
In response, FCA chief executive Andrew Bailey told the committee on Tuesday: "We are giving thought at this stage... as to whether we could usefully issue guidance, not obviously to change the rules but to issue guidance on the application of the rules, particularly on this question of inside information."
Having the watchdog look into the issue is convenient given the current political situation as the UK is readying itself for the divorce from the EU on 29 March 2019.
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