Regulator hammers Deutsche Bank with huge fine

A LEADING City bank is to pay a record £1.6 billion fine as part of a settlement with US regulators over the rigging of interest rates.

Deutsche Bank’s fine from the UK’s Financial Conduct Authority (FCA) amounted to an additional £227 million after the watchdog found traders manipulated rate submissions between January 2005 and December 2010. The FCA also accused the lender of repeatedly misleading their inquiry.

Georgina Philippou, the FCA’s acting director of enforcement and market oversight, said: “This case stands out for the seriousness and duration of the breaches by Deutsche Bank – something reflected in the size of today’s fine.

“One division at Deutsche Bank had a culture of generating profits without proper regard to the integrity of the market. This wasn’t limited to a few individuals but, on certain desks, it appeared deeply ingrained.”

The breaches involved at least 29 Deutsche Bank staff, primarily based in London but also working in Frankfurt, Tokyo and New York.

The FCA said their behaviour went unchecked because of inadequate systems and controls, with the Bank taking more than two years to identify and produce all the relevant audio recordings it had requested.

Deutsche Bank tried to claim to the FCA that its systems had been adequate, even though the person making this statement knew that to be false.

Ms Philippou added: “Deutsche Bank’s failings were compounded by them repeatedly misleading us. The bank took too long to produce documents and moved far too slowly to fix relevant systems and controls. This case shows how seriously we view a failure to co-operate with our investigators and our determination to take action against firms where we see wrongdoing.”