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Additionally , the process in which penalties were being distributed , collected and recorded was fraught with discrepancies . Penalties were being applied against trades that hadn ’ t yet reached their date of settlement , data being reported on a daily basis was inconsistent with the month-end reports , penalty notices were not reaching recipients on time , the list goes on . “ The penalties mechanism calculates a separate penalty per failing transaction per day ,” explains De Paolis . “ This is a very high volume process . For the mechanism to work properly , there is a critical need for a very high level of accuracy , reliability and straight-through processing throughout the custody chain .
“ That less scripted element of testing needed to be done , but it wasn ’ t given sufficient time – that ’ s where some of those teething issues became more apparent .”
Despite some recent improvements , the market as a whole has not yet reached a sufficiently high level of processing efficiency .” Matt Johnson , director of ITP product management and industry relations at The Depository Trust & Clearing Corporation ( DTCC ), picks up on this point , acknowledging that it will take
SACHIN MOHINDRA , DIRECTOR , GOLDMAN SACHS
time for the industry to adjust to the new measures and requirements : “ With all things like this , there ' s going to be some process changes , some development changes , even some code changes to business platforms , services and their proprietary systems . These adjustments need to be tested , reconciled and validated . To only allow yourself a couple
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