This is a marketwatch.com article.
The U.S. Commodity Futures Trading Commission said it ordered Deutsche Bank AG to pay a $2.5 million civil penalty to settle claims the bank failed to properly report swaps transactions between January 2013 and July of this year.
The CFTC said Deutsche Bank didn’t diligently address and correct the reporting errors until the bank was notified of the CFTC’s investigation, and failed to have an adequate swaps supervisory system governing its swaps reporting requirements.
According to the CFTC order, Deutsche Bank consented to the order without admitting or denying any of the findings or conclusions. A company spokesman declined to comment.
Under the order, Frankfurt-based Deutsche Bank also was required to improve its internal controls related to its swaps reporting program.
The CFTC said this is the agency’s first action enforcing new Dodd-Frank requirements that provide for the real-time public reporting of swap transactions and the reporting of swap data to swap data repositories.
The 2010 Dodd-Frank law aimed to boost the safety of the multi-trillion-dollar swaps market.
Swaps, contracts in which two parties agree to exchange payments based on fluctuations in interest rates or other benchmarks, were targeted by U.S. lawmakers for greater oversight and transparency after they played a central role in the financial crisis. Companies use the swaps market to hedge risks or make bets in such areas as fuel prices or interest rates.
According to the CFTC order, Deutsche Bank failed to properly report cancellations of swap transactions, which overall included tens of thousands and hundreds of thousands of reporting violations, errors and omissions in its swap reporting. The CFTC also alleged that Deutsche Bank misused cancellation messages for non-cancellation events.
The CFTC also maintains that Deutsche Bank had been aware of problems relating to its cancellation messages since its reporting obligations took effect at the end of 2012, but failed to provide timely notice to its swap data repository and didn’t look into or fix the problems until it was notified of the CFTC probe in June 2014, leading to misinformation being released to the market.
PiggyBankBlog Courtroom Bailiff: “All rise! .The Honorable Super Attorney Oliver Max Gardner III has entered the Courtroom of Public Opinion in recent PiggyBankBlog.com and Court of Public Opinion Part One Interview!”