OSC Approves $600,000 Settlement with Liquidnet Canada for ATS Trading Breach
Summary
The Capital Markets Tribunal approved OSC's settlement with Liquidnet Canada Inc. (LCI) for breaches of National Instrument 21-101 Marketplace Operation. LCI, an alternative trading system operator, disclosed trade and order information of market participants to unauthorized employees of foreign affiliates. LCI also failed to be forthcoming with the OSC regarding a trading suspension. LCI paid a $600,000 CAD administrative penalty plus investigation costs and must undergo an independent review of its practices and procedures.
What changed
The Capital Markets Tribunal approved a settlement between the OSC and Liquidnet Canada Inc. for violations of National Instrument 21-101 Marketplace Operation. LCI, which operated fixed income and equities alternative trading systems, improperly allowed certain trade and order information to be visible to employees of its foreign affiliates who were not authorized under Ontario securities law. Additionally, LCI failed to be fully forthcoming with the OSC when the visibility issue on its fixed income ATS first emerged.
Marketplace operators in Ontario must ensure strict confidentiality of market participant information and full cooperation with the OSC during investigations. The $600,000 penalty and mandatory independent consultant review serve as reminders that the OSC takes breaches of marketplace operation obligations seriously and will take decisive action to protect investors and maintain integrity in Ontario's capital markets.
What to do next
- Review confidentiality protocols to ensure trade and order information is accessible only to authorized personnel
- Cooperate with independent consultant review of practices and procedures
- Ensure compliance with National Instrument 21-101 confidentiality requirements for marketplace operators
Penalties
$600,000 CAD administrative penalty plus investigation costs
Archived snapshot
Apr 16, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
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OSC reaches settlement with Liquidnet Canada Inc.
April 15, 2026
For Immediate Release
TORONTO – On April 15, 2026, the Capital Markets Tribunal approved the Ontario Securities Commission’s (OSC) settlement agreement with Liquidnet Canada Inc. (LCI), a marketplace operator, following breaches of National Instrument 21-101 Marketplace Operation (NI 21-101).
LCI operated fixed income and equities alternative trading systems (ATS s) in a manner contrary to the confidentiality requirements. Specifically, certain trade and order information of market participants was visible to some employees of LCI’s foreign affiliates who were not authorized under Ontario law to see it. In addition, when the visibility issue on LCI’s fixed income ATS first came to light, LCI voluntarily suspended certain trading on the ATS without being as forthcoming with the OSC as it should have been about what led to the suspension.
As part of the settlement agreement, LCI has paid an administrative penalty of $600,000 (CAD) for failures to comply with Ontario securities law, as well as costs of the investigation. LCI will also submit to a review of its practices and procedures by an independent consultant.
“Marketplaces have a clear obligation to investors to operate fairly and in compliance with the rules,” said Bonnie Lysyk, Executive Vice President, Enforcement, Ontario Securities Commission. “The OSC takes breaches of those obligations seriously and will take decisive action where warranted to protect investors and safeguard the integrity of Ontario’s capital markets.”
The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair, efficient and competitive capital markets and confidence in the capital markets, to foster capital formation, and to contribute to the stability of the financial system and the reduction of systemic risk. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at www.osc.ca.
Notes to Editors:
- NI 21‑101 sets out the rules marketplaces, including ATS s must follow to operate in Canada, including requirements designed to ensure fair, transparent, and orderly trading. Compliance with these obligations is central to the OSC’s oversight and enforcement of market conduct. – 30 –
For Media Inquiries:
Curtis Lindsay
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For Investor and Industry Inquiries:
1-877-785-1555 (Toll Free)
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