Japan SESC raps Credit Lyonnais

The Credit Lyonnais branch responded by saying that the three transactions had involved limited sums and had resulted from intra-day execution errors rather than being premeditated by its operators.

But in light of its understanding that its operations must be"irreproachable", the branch would "take all appropriate internal measures to make sure that its internal controls will prevent in the future any possible breach in industry regulations, it said in a statement.

The SESC cannot decide punishments, but it can recommend to the Financial Reconstruction Commission and Financial Supervisory Agency that action be taken against institutions found to have broken Financial regulations.

Foreign financial institutions in Japan have come under increasing scrutiny in recent months, as the SESC has grown more aggressive in its surveillance of the financial sector.

Last month, Deutsche Bank Group was asked to come up with plans to improve business practices at its five local affiliates.

That fell far short of the penalties imposed last year on Credit Suisse Financial Products, a Credit Suisse subsidiary, which lost its business licence in one of the harshest penalties ever imposed on a Financial firm in Tokyo.