Did we buy or sell? Confusion leads to £4.7m fine for Deutsche

Bank’s contract-for-difference equity swaps were incorrectly reported

Deutsche Bank in London has been fined £4.7m by the City watchdog for incorrectly reporting tens of millions of transactions in a way that meant the regulator would have been unable to detect any market abuse or insider trading.

Every one of Deutsche Bank’s trades known as contract-for-difference equity swaps carried out between November 2007 and April 2013 – a total of more than 29.4 million – had been incorrectly reported, the Financial Conduct Authority (FCA) revealed. Every sale of the product by the lender was labelled as a buy, and vice-versa.

Tracey McDermott, the FCA’s director of enforcement and financial crime, said although Deutsche did not profit from its them, there was “simply no excuse” for the failings. “Effective market surveillance is critical to maintain the integrity of our markets and depends on accurate and timely reporting of transactions,” she said. “Deutsche 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. There is simply no excuse for Deutsche’s failure to get this right.”

CFDs are used to bet on the movement of share prices, and companies are required by the FCA to submit the details, such as the price and the quantity, of each transaction.

The City regulator is cracking down on the misreporting of financial transactions, with Deutsche Bank the 11th institution to have been fined by the watchdog.

Other penalties have included a £5.6m fine for Royal Bank of Scotland last year, over the reporting of share dealings, and a £2.5m fine for Barclays in 2009 for 58 million reporting errors.

The FCA said that Deutsche’s failures were “particularly serious” – because it had issued the bank with a private warning in 2010, warned publically about actions it had taken against other banks and repeatedly issued guidance on how to report trades properly.

A spokeswoman for Deutsche Bank said that when the coding issue was identified in March 2013, it “immediately undertook a complete review of our transaction reporting systems to rectify the problem and strengthen our control framework”.

Deutsche Bank was given a 30 per cent discount on the fine for settling early.

Reports last month said the Federal Reserve Bank of New York wrote to Deutsche at the end of 2013 demanding improvements to its filings in the US, claiming reports produced by the bank were “low quality, inaccurate and unreliable”.

Start your day with The Independent, sign up for daily news emails
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine