On October 29, 2015, The Financial Futures Association of Japan imposed administrative disciplinary action against Mitsubishi UFJ Financial Group’s Kabu.com Securities based on findings of the inspection. The company received a reprimand. The findings include followings;
Highly-inadequate management of system failures
Securities and Exchange Surveillance Commission found kabu.com Securities vastly underreported the number of system failures to the authority and executive officer accepted the number.
Inadequate management of system development
The company’s guideline of quality management for system development fails to contain some basic test items. Due to this, program failures couldn’t be detected during the development phase and the quality control was poor. This resulted in a number of system failures that affected customers after the launch of the system.
In addition, its progress management of system development wasn’t conducted in line with the company rules. As only work descriptions for the development were reported to executive officers, the executives couldn’t properly manage the progress or delaying.
Ineffective Internal Audit
The company has a lack of auditors who have knowledge to detect management problems of the system. The company’s internal auditors reported to the board of directors that they confirmed the system development had mostly no problems despite not verifying management of quality and progress for the system management.
- 2015/10/13 Japan Securities Dealers Association reports the number of system failures in September
- 2015/08/12 Japan self-regulatory organization disclosed number of reported system failures in July
- 2015/05/25 kabu.com Securities will offer underage trading accounts from June
- 2015/05/15 kabu.com securities received a recommendation of administrative action after the inspection