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Regulation and Compliance > Federal Regulation > FINRA

FINRA Fines Deutsche Bank $6M for Bad, Late Trading Data

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The Financial Industry Regulatory Authority has fined Deutsche Bank Securities $6 million for failing to provide complete and accurate trade data to both it and the Securities and Exchange Commission from 2008 to 2015.

The regulatory group says that Deutsche Bank “experienced significant failures with its blue sheet systems,” such as programming errors, and it failed to make improvements to meet regulatory reporting rules. As a result, the firm submitted “thousands of blue sheets to regulators that misreported or omitted critical information on over 1 million trades,” FINRA said in a press release.

Also, FINRA found that a large number of Deutsche Bank’s blue sheet submissions did not meet regulatory deadlines, which typically are 10 business days after a blue sheet request. Between January 2014 and August 2015, for instance, about 40% of Deutsche Bank’s blue sheets were filed after the deadline, while from July to August 2015, more than 90% of Deutsche Bank’s blue sheets were not submitted to FINRA on a timely basis.

Deutsche Bank neither admitted nor denied the charges but agreed to retain an independent consultant to improve its policies, systems and procedures related to blue sheet submissions, the regulatory group says. (Deutsche Bank declined to comment on the matter.)

According to FINRA, regulators ask for blue sheets to help prevent and stop market manipulation and insider trading. The data must be shared electronically upon request and include details on the securities involved, prices, share quantities, customer names, and whether the trades are buys, sells or short sales.

“Firms are expected to provide complete, accurate and timely blue sheet data in response to regulatory requests,” said Cameron Funkhouser, executive vice president and head of FINRA’s Office of Fraud Detection and Market Intelligence, in a statement. “Incomplete and inaccurate blue sheet data compromises our ability to identify individuals engaging in insider trading schemes and other fraudulent activity. Firms must invest the resources necessary to ensure that they are providing complete and accurate blue sheet data whenever requested – without exception.”


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