Deutsche Bank fined US$9.5m
GERMAN lender Deutsche Bank has agreed to pay a US$9.5 million penalty after US securities regulators accused it of failing to safeguard market-sensitive information.
The penalty comes with investors on tenterhooks as the capitalweak Frankfurt bank negotiates a multi-billion-dollar settlement with the US Justice Department over the bank’s trading in toxic mortgagebacked securities prior to the global financial crisis of 2008.
According to the Securities and Exchange Commission, Deutsche Bank encouraged analysts to talk frequently with customers and trading staff, but lacked internal controls to prevent unpublished research from being passed on.
Securities laws require that analysts to protect “material nonpublic information”, like buy and sell recommendations, before it is published.
Insider-trading laws and regulations prohibit investors from buying or selling stocks based on material non-public information. –