CISI Combating Financial Crime: Market Abuse Regulation (MAR)—Scope, Prohibitions, Disclosure and STOR Duties

CISI Combating Financial Crime covers market abuse because it threatens market integrity and investor protection. Even if your day-to-day role is not trading, you need to understand how inside information and manipulative behaviour are policed—and what reporting and disclosure obligations exist.

From an exam perspective, MAR is tested through scope questions (what instruments/venues are covered), behavioural prohibitions (insider dealing, unlawful disclosure, market manipulation), and firm/issuer obligations (public disclosure timing, insider lists, and suspicious order/transaction reporting).

This lesson summarises MAR in a structured way, focusing on what you must recall quickly in a multiple-choice setting.

Where this topic sits inside CISI Combating Financial Crime

This lesson sits under Market Abuse and International Initiatives. It also connects to governance and compliance culture because many MAR obligations are operational (maintaining lists, monitoring, reporting, and handling whistleblowing notifications).

The concept explained in plain English

The EU Market Abuse Regulation (MAR) aims to increase market integrity and investor protection. In simple terms, it:

• Defines and prohibits key market abuse behaviours: insider dealing, unlawful disclosure of inside information, and market manipulation.
• Extends coverage across different trading venues and instruments, including cases where an instrument’s price/value depends on or affects another covered instrument (eg, certain derivatives).
• Creates practical obligations: issuers must disclose inside information publicly as soon as possible (with limited permitted delay conditions), keep insider lists, and certain participants must monitor and report suspicious transactions and orders to the regulator (often called STOR reporting).

UK context note: following the UK’s exit from the EU, UK MAR has been amended via UK regulations to transpose and maintain an aligned framework. For any jurisdiction-specific detail, verify in the official CISI syllabus/workbook and current FCA guidance.

How it works step-by-step

1. Scope check: identify whether the financial instrument/venue falls within MAR coverage (regulated markets, MTFs, OTFs, and related instruments that affect covered prices/values).
2. Identify inside information: information that could move price/value and is not public (high-level exam concept).
3. Prevent prohibited behaviour: controls to stop insider dealing, unlawful disclosure, and manipulation.
4. Issuer actions:
   • Disclose inside information publicly as soon as possible (unless a permitted delay applies).
   • Maintain insider lists of those with access to inside information.
5. Firm monitoring and reporting:
   • Monitor orders and transactions for suspicious patterns.
   • Report suspicious transactions and orders to the regulator (distinct from AML suspicious activity reporting obligations).
6. Whistleblowing channel: MAR expects mechanisms for reporting suspected market abuse; approaches differ by jurisdiction.

Practical examples

• Insider dealing: An employee trades a listed instrument after learning unpublished price-sensitive results.
• Unlawful disclosure: A person with access to inside information shares it inappropriately with a friend or contact.
• Market manipulation: Placing orders intended to mislead the market about supply/demand (conceptually), then cancelling.
• STOR-style trigger: A sudden spike in orders ahead of an announcement inconsistent with normal patterns (requires investigation and potential reporting per policy).

Exam focus: how this is tested

• Scope questions: which venues/instruments are in MAR’s perimeter.
• Three prohibitions: name/recognise insider dealing, unlawful disclosure, manipulation.
• Issuer obligations: public disclosure timing, permitted delay concept, insider lists.
• Reporting: suspicious orders and transactions reporting is distinct from AML reporting.

Common pitfalls and how to avoid them

• Pitfall: Treating MAR as only about listed shares. Avoid: Remember the scope extends to multiple venues and related instruments/derivatives.
• Pitfall: Confusing AML suspicious activity reports with MAR suspicious order/transaction reports. Avoid: Keep them conceptually separate; they may have different triggers and recipients.
• Pitfall: Forgetting issuer operational duties. Avoid: Insider lists and disclosure obligations are key exam points.
• Pitfall: Overstating whistleblower incentives in the UK. Avoid: Know that incentives depend on local implementation.

Self-test (original questions)

1. Question: Name the three core prohibitions commonly associated with MAR.
   Answer: Insider dealing, unlawful disclosure of inside information, and market manipulation.
   Explanation: These are the headline behaviours MAR targets.
2. Question: True/False: MAR applies only to instruments on a regulated market.
   Answer: False.
   Explanation: It also applies to instruments on MTFs/OTFs and certain related instruments.
3. Question: What is an “insider list” used for?
   Answer: To record people with access to inside information.
   Explanation: It supports accountability and investigations.
4. Question: What is the general expectation for disclosing inside information?
   Answer: Make it public as soon as possible, subject to permitted delay conditions.
   Explanation: Timing of disclosure is central to market integrity.
5. Question: Suspicious order/transaction reporting under MAR is the same as AML SAR reporting. True/False?
   Answer: False.
   Explanation: They are separate regimes with different purposes and processes.
6. Question: Give one example of behaviour that could be market manipulation in principle.
   Answer: Placing misleading orders to create a false impression of demand.
   Explanation: Manipulation aims to distort market signals.
7. Question: Why does MAR include whistleblowing provisions?
   Answer: To help detect and report suspected market abuse.
   Explanation: Internal/external reports can surface misconduct early.
8. Question: After UK exit from the EU, did the UK remove MAR entirely?
   Answer: No; it was amended/transposed to operate in UK law.
   Explanation: The framework remains aligned in core principles.
9. Question: What’s a quick scope clue in an exam vignette?
   Answer: Trading on regulated markets, MTFs/OTFs, or instruments linked to those markets.
   Explanation: Venue/instrument linkage drives perimeter.

Note for candidates in Jersey

If you are working toward CISI Combating Financial Crime Jersey, plan your revision so market abuse topics are revisited in short bursts: one session on scope (venues and instrument linkages), one on the three prohibitions, and one on issuer/firms obligations (disclosure, insider lists, suspicious order/transaction reporting). This spacing helps prevent mixing MAR concepts with AML reporting obligations. When scheduling your exam, keep your administrative checklist clear: confirm delivery method, identification requirements, and any jurisdiction-specific booking steps directly with CISI and/or the exam provider.

FAQs

• What is MAR trying to protect?
  Market integrity and investor protection.
• Which behaviours does MAR prohibit?
  Insider dealing, unlawful disclosure of inside information, and market manipulation.
• Does MAR cover MTFs and OTFs?
  Yes, it extends beyond regulated markets to other trading venues.
• Why are insider lists required?
  To track who has access to inside information and support effective oversight.
• What is the general rule on disclosing inside information?
  Disclose publicly as soon as possible, with limited conditions where delay may be permitted.
• Are MAR suspicious reports the same as AML SARs?
  No. They are separate reporting regimes.
• Does UK MAR still exist after Brexit?
  Yes, it was amended and transposed to continue operating within UK law.
• Is whistleblowing always financially rewarded?
  Not necessarily; incentives depend on local implementation.

Next step

To master market abuse scope and reporting obligations within your wider study plan, use the full CISI Combating Financial Crime course and practise rapid-fire definition questions on www.TadawulExams.com.

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Always verify exam rules, pass marks, and booking steps with the official CISI syllabus and the exam provider.

Quick Quiz

1. Which is NOT one of the core MAR prohibitions?

   • A. Insider dealing
   • B. Unlawful disclosure of inside information
   • C. Market manipulation
   • D. Credit risk modelling

2. Issuers are generally expected to disclose inside information:

   • A. Only at year-end
   • B. As soon as possible (subject to permitted delay conditions)
   • C. Only to selected investors
   • D. Only after a regulator requests it

3. MAR requires certain participants to report:

   • A. Suspicious transactions and orders
   • B. All profitable trades
   • C. All customer complaints
   • D. All tax filings

Answers

• 1: D
• 2: B
• 3: A