Deutsche Bank fined €56 million for trying to rig benchmark rate
Deutsche Bank agrees to €56 million to settle US regulator's claims traders sought to manipulate a benchmark for interest-rate derivatives and other financial instruments

For years, traders at Deutsche Bank Securities sought to rig the ISDAfix to benefit the firms' positions on cash-settled options on interest-rate swaps, the Commodity Futures Trading Commission said in a statement late Thursday announcing the settlement. Investigators said the bank's personnel attempted to steer the rate with a pair of strategies and that abuses occurred from 2007 until May of 2012.
The bank's staff allegedly knew, and even discussed, that they were breaking the law. At one point, a trader confided to a broker that " lot of people would actually do jail time" if the government ever caught on, the agency wrote in its statement.
Though arcane, ISDAfix plays an important role in global financial markets, helping determine the value of trillions of dollars of interest-rate swaps and other instruments. Rigging can have far-flung effects, with fluctuations in the benchmark helping to determine the performance of structured notes bought by wealthy individuals and the amounts some states pay on pension annuities.
"There is no room in our markets for manipulation," the CFTC’s director of enforcement, James McDonald, wrote in the statement. "We will continue to work hard to stamp it out, wherever we find it".
Deutsche Bank Securities, a subsidiary of the Frankfurt-based firm, settled the agency’s complaint without admitting or denying wrongdoing.
"We have cooperated extensively with the CFTC’s investigation and have undertaken significant efforts to remediate benchmark-related activities," Deutsche Bank said in an emailed statement.
The company follows firms including Citigroup, Barclays Plc, Goldman Sachs Group and Royal Bank of Scotland in settling CFTC probes involving ISDAfix. The agency has levied more than €480 million in fines. Typically -- as in Deutsche Bank's case -- it has alleged attempted manipulation, not showing banks and brokers actually changed the rate.
Editor's Picks
Still no room for Uber as officials aim to lower taxi fares
European Parliament briefly suspends Luxembourg's Semedo
Under Biden, more countries could follow US in space
Fraud case focuses on details of 2013 suicide at EIB
On-line, mobile? Luxembourg banks taking it slow
Sign up for your
free newsletters
Get the Luxembourg Times
delivered to your inbox twice a day