France’s financial market regulator AMF has fined Morgan Stanley €20 million (U.S. $22.2 million) for manipulating the price of French and Belgian government bonds in June 2015.

According to AMF, Morgan Stanley manipulated 14 French government bonds (OAT) and eight Belgian bonds (OLO). It also manipulated the price of an OAT futures contract, AMF said.

On June 16, 2015, within less than 15 minutes—between 9:29 am and 9:44 am—the European Government Bonds Desk at Morgan Stanley “aggressively purchased” a significant number of French sovereign bonds futures contracts (OAT Futures or FOAT) and German sovereign bonds futures contracts (Bund Futures (FGBL) and Buxl Futures (FGBX)) on the German derivatives regulated market, Eurex, AMF said. “At 9:44 am, the traders then sold 17 different OATs for €815 million (U.S. $905 million), mainly on the MTS France and BrokerTec electronic trading platforms, and eight OLOs for €340 million (U.S. $378 million) on the MTS Belgium platform,” AMF said.

The Enforcement Committee of AMF found Morgan Stanley had secured the price of the September 2015 FOAT traded on Eurex, as well as the price of 14 of the 17 OATs and eight OLOs, at an “abnormal and artificial level.” It considered the purpose of the FOAT acquisitions was “to influence a price increase of this financial instrument” in order to cause “an abnormal and artificial increase in the price of the OATs and OLOs, because of the correlation links between these instruments, immediately before they were sold.”

The Enforcement Committee said these acts constituted price manipulation through “a form of deception,” since the FOAT acquisition was inconsistent with the overall strategy of the European Government Bonds Desk and “had the effect of giving other participants a distorted picture of the state of the French sovereign bond market.”

The Enforcement Committee, however, dismissed the complaint of price manipulation of FGBL and FGBX, considering the purpose of the operations on these instruments was not to obtain a certain price quotation so to influence the price of the OATs. Morgan Stanley maintains its actions are “consistent with market practices” and said it will appeal the decision.

The largest fine ever imposed by AMF’s Enforcement Committee was €35 million (U.S. $39 million) in July 2017 against Natixis Asset Management for having breached its professional obligations in the management of formula funds between 2012 and 2015.