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- Heather Heyer’s Mother Says, ‘I’m Not Talking to the President’
- Goldman Sachs May Have Lost $100Mn on Energy Bet Gone Wrong
- SEC Drops Case Against Ex-JPMorgan Traders Over 'London Whale'
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- FINRA Amends Codes Regarding Expedited Arbitrator List Selection
- FINRA July 2017 Quarterly Disciplinary Review (Podcast)
- Senior Exec in Citigroup's Equities Unit Has Left
- Prudential Plotting its Escape From Fed's Tough Oversight
- Why CEOs Spurned Trump's Business Councils, in Their Own Words
- A Stockbroker, Her LLC, and Her Customers' Loans (Or Investment?) - Bill Singer
- Brian Quintenz Sworn In as CFTC Commissioner
- A Gary Cohn Resignation Would 'Crash the Markets' – Mgmt Guru Jeffrey Sonnenfeld
- Trading Firm DRW to Buy RGM Advisors - As Low Volatility Forces Out Weak HFT Players (subsc reqd)
- Reputational Damage - Rajat Gupta on Hard Road to Recovery
- 7th Circuit Affirms Spoofing Conviction - Bill Singer
- Wells Fargo Announces Board Changes
- Judge Rules Against Ex-Goldman Employee in Fed Leak Case
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NEWSLETTERS & ALERTS
Federal Reserve Fines Deutsche Bank $157Mn for Forex, Supervisory Violations
[Photo: By Björn Laczay, from Moosburg, Germany / Flickr]
Deutsche Bank agreed to pay $157 million to settle Federal Reserve charges that bank foreign exchange traders had used chat rooms to communicate with other banks, and thus violated both foreign exchange rules and Volcker rules:
- $20 million for having lax supervision i.e., failed to detect and prevent its forex traders from using chat rooms; and,
- $137 million for having disclosed some positions and for coordinating trading strategies with other banks.
Regulators based their findings, in part, on transcripts of bank traders communicating in online chat rooms, which emerged more than a year ago.
FIRST VOLCKER RULE TRADING INFRACTION. What makes this settlement significant is the fact that Deutsche Bank is the first big bank to be fined by the Federal Reserve under the Volcker Rule’s proprietary trading ban. Big bank traders are now restricted to assisting clients in buying or selling securities, and may derive profits from spreads or price moves – although differentiating between proprietary trading and market making can be difficult.
ANOTHER REGULATORY INVESTIGATION. Deutsche Bank faces ongoing investigation by the New York State Department of Financial Services (NYSDFS) which has been looking into whether the bank used algorithms on trading platforms to front-run or otherwise take advantage of clients.