Deutsche Bank Unit to Pay $3 Million to Settle CFTC Charges

Deutsche Bank Securities Inc. (DBSI), a registered Futures Commission Merchant (FCM) based in New York, N.Y., will pay $3 million for failing to properly invest customer segregated funds, failing to prepare and file accurate financial reports, failing to maintain required books and records, and for related supervisory failures.

DBSI is an indirect, wholly-owned subsidiary of the parent company, Deutsche Bank AG.


The CFTC’s order finds that, for the period June 18, 2012 through August 15, 2012, DBSI failed to accurately compute the amount of customer funds on deposit.

As a result of these miscalculations, DBSI’s investment of customer funds in certain money market mutual funds during that period exceeded the 50% asset-based concentration limit for such investments in violation of CFTC rules.

The order also finds that on at least six occasions between June 2011 and March 2013, DBSI failed to file accurate financial statements with the CFTC.

DBSI did not have automated processes in place designed to ensure the accuracy of the firm’s financial reporting.

Consequently, DBSI filed six amended FOCUS Reports as a result of the errors, the Order finds.

DBSI failed to create and maintain complete and systematic records, such as order tickets, for a number of block trades it executed at various times throughout October 1, 2009 and March 16, 2012.

The CFTC order finds that each of these violations was a result of DBSI’s failure to maintain adequate controls and systems, reflecting a lack of supervision over its business as a CFTC registrant.

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