Deutsche Bank Will Pay $2.5 Million to Settle Swap Rule Failures

Deutsche Bank AG will pay $2.5 million to settle U.S. regulatory claims that the bank repeatedly violated reporting requirements for derivatives and neglected to fix the problem until being told of a government investigation.

The bank’s data systems led to tens of thousands of errors in reports on interest-rate, credit and other derivatives from January 2013 through July of this year, the Commodity Futures Trading Commission said in a statement on Wednesday.

Deutsche Bank, which was aware of the violations in 2013, didn’t take sufficient steps to resolve the problems until the CFTC’s enforcement division said it was investigating the matter last year, the agency said.

The settlement marks the CFTC’s first enforcement of reporting rules required by the 2010 Dodd-Frank Act that are designed to shine a light on the previously opaque swap market.

“When reporting parties fail to meet their reporting obligations, the CFTC cannot carry out its vital mission of protecting market participants and promoting market integrity,” Aitan Goelman, the agency’s enforcement chief, said in the statement. Renee Calabro, a spokeswoman for Deutsche Bank, declined to comment.

Deutsche Bank over the past two years has been scrutinized by the Federal Reserve Bank of New York and U.K. Financial Conduct Authority for lapses in handling of market data.

The Frankfurt-based lender was fined $7.8 million by the British markets regulator in August 2014 for a coding error tied to equity swaps. The New York Fed sent a letter to the bank in late 2013 saying a review of its U.S. operations found they suffer from inadequate oversight.

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