UK regulator slaps Deutsche Bank with £4.7 million fine

gavellaw booksThe Financial Conduct Authority (FCA) has slapped the London branch of Deutsche Bank with a fine in excess of £4.7 million (€5.9 million) for incorrectly reporting tens of thousands of transactions.

The UK regulator says between November 2007 and April 2013, the bank, headquartered in Frankfurt, failed to properly report just over 29 million equity swap contracts for difference transactions.

Deutsche Bank says the software coding issue in its reporting system that caused the failings was identified in March 2013 and has since been fixed.

The failure, which the FCA says affected all of the bank's equity swap contracts for difference transaction reports, breaches UK rules on transaction reporting.

Tracey McDermott, the regulator's director of enforcement and financial crime, says: ''Effective market surveillance is critical to maintain the integrity of our markets and depends on accurate and timely reporting of transactions."

She says Deutsche Bank is a major market participant responsible for reporting millions of transactions every year.

"We have repeatedly highlighted the importance of accurate transaction reporting and taken enforcement action against a number of firms," she adds.

"There is simply no excuse for Deutsche's failure to get this right."

The FCA says it uses these reports in a number of ways – including identifying and investigating suspected market abuse, for example insider trading and market manipulation.

Deutsche Bank says: "In March 2013 a software coding issue in our reporting system for certain CFD and swap transactions was identified. We immediately undertook a complete review of our transaction reporting systems to rectify the problem and strengthen our control framework."

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