Twelve large banks and brokers in Japan have been ordered by the country’s financial regulator to review their internal controls for handling sensitive information and report back on the results in a month as a crackdown on insider trading builds.

The Financial Services Agency has told the 12 brokers, which were underwriters to recent large new share issues, to report on the structures of their underwriting, institutional sales and compliance divisions, how information about institutional clients is managed and any issues that arise from those inspections and how they are dealing with them.

The 12 are Nomura, Daiwa, Nikko SMBC, Mitsubishi UFJMorgan Stanley, Mizuho as well as the Japanese units of JPMorgan , Deutsche Bank , Goldman Sachs , Citigroup , UBS , Merrill Lynch and Morgan Stanley .

The FSA’s latest move comes amid a crackdown on insider trading, which found that all top three Japanese brokers as well as JPMorgan had leaked non-public information that was used by funds to profit ahead of large new share issues. It signals it is serious about cleaning up Japan’s capital markets by clamping down on insider trading and information leaks and other breaches of the rules, officials at the brokers said.

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