System outage sees Deutsche Bank charged over reporting failures

CFTC in the US has found Deutsche Bank had shown an inability to comply with swap reporting requirements.

Deutsche Bank has been charged by the US derivatives watchdog, for failing to report swap data for multiple asset classes for five days.

The Commodity Futures Trading Commission (CFTC) found that a system outage prevented the bank from submitting the reports, and the CFTC said, “subsequent efforts to end the system outage repeatedly exacerbated existing reporting problems.”

The charge to Deutsche Bank comes almost one year after it was fined $2.5 million by the CFTC for failing to properly report swaps transactions over a period of 18 months.

The CFTC also found the data Deutsche Bank managed to submit was incomplete and ‘untimely,’ as it failed to supervise the staff responsible for the swaps data reporting.

It was also alleged the bank did not have adequate ‘business continuity and disaster recovery plans’.

In response to the charges, the CFTC and Deutsche Bank have filed a joint motion to appoint a monitor to ensure the bank’s compliance with reporting requirements.

The monitor will assess and make recommendations for improvements to Deutsche Bank’s swaps data reporting systems.

Director of enforcement at the CFTC, Atian Goelman, sad the bank’s “repeated violations warrant the intervention of a Court-appointed monitor.”

Goelman added: “Deutsche Bank has shown over the last year its inability to comply with its swap reporting responsibilities.”

The CFTC said it is likely to impose a financial penalty and a permanent injunction for the charges.

The charge to Deutsche Bank is the latest in a string of fines imposed on the German bank. Over the past few weeks, the Financial Industry Regulatory Authority (FINRA), Wall Street’s self-regulatory body, fined the bank $6 million and $12.5 million for errors relating to inaccurate trade data and internal research and data management respectively.