Deutsche Bank fined US$9.5m

The Myanmar Times - - International Business -

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. –

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