Deutsche Bank has agreed to pay $9.5m in fine to the US Securities and Exchange Commission (SEC) to settle allegations of failure to keep proper controls over material non-public information generated by its research analysts.
The regulator also alleged that the bank published an improper research report and failed to provide certain electronic records sought during the probe.
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SEC said that the German lender encouraged its equity research analysts to communicate with customers and its own traders, but failed to implement policies that could prevent analysts from disclosing yet-to-be-published views and analyses, changes in estimates, and short-term trade recommendations.
SEC division of enforcement associate director Antonia Chion said: “Information generated by research analysts such as ratings, views, estimates, and trading recommendations can move markets.
“Broker-dealers must maintain and enforce policies and procedures that are reasonably designed in light of the nature of their business to prevent the misuse of such information.”
The bank neither admitted nor denied the allegations.
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By GlobalDataSEC also alleged Deutsche Bank of issuing a research report with a “BUY” rating about retailer Big Lots, even though the analyst who had prepared it privately told others that the retailer should have been downgraded.
The regulator also charged the bank for failing to provide certain electronic records to the regulator during the course of the probe.
The latest fine follows the $14bn fine that the bank was asked to pay to the US Department of Justice (DoJ) in September 2016 for its handling of residential mortgage-backed securities and related transactions.
