London Metal Exchange Fined £9.2 Million Over 2022 Nickel Price Chaos

The London Metal Exchange (LME) has been fined £9.2 million ($11.9 million) by the UK’s Financial Conduct Authority (FCA) for failing to maintain adequate systems and controls during a 2022 nickel price surge.

Nickel prices more than doubled to over $100,000 per tonne within an hour on March 8, 2022, driven by a failed bet from a Chinese billionaire amid market turmoil following Russia’s invasion of Ukraine.

The LME halted trading and canceled all transactions from that day, but the FCA found the exchange unprepared to manage the extreme volatility.

Senior managers, responsible for handling market disruptions, were not on duty, leaving junior staff to manage the crisis.

The fine marks the FCA’s first enforcement action against a UK investment exchange, with both the regulator and LME stating improvements have since been made to prevent a repeat incident.