Deutsche Bank to Pay $157M in Volcker Rule Violations

Deutsche Bank to Pay $157M in Volcker Rule Violations

Two Federal Reserve probes into Deutsche Bank have resulted in the giant bank agreeing to pay nearly $157 million to settle claims that it violated the Volcker Rule by permitting traders to rig foreign exchange rates.

According to the Federal Reserve, the bank’s “deficient policies and procedures” allowed trading desks to disclose their positions and coordinate with traders at other banks to move prices in ways that benefitted Deutsche Bank.

Forex and Volcker Rule Violations Result in Fines

Roughly $137 million of the fine relate to Forex violations, with the other $20 million fine resulting from risky trading in the bank’s proprietary trading account. A bank must follow the Volcker Rule, which is enforced by five federal agencies and established under the 2010 Dodd-Frank Act. The Volcker Rule prohibits U.S. banks from making certain kinds of speculative investments that do not benefit their customers.

The bank also will be required to submit plans and progress reports regarding its compliance with the applicable rules and regulations.

Deutsche Bank’s History of Violations

This isn’t the first time Deutsche Bank has been fined, and it is far from its largest fine: In December, the bank paid $7.2 billion to resolve charges related to its sales of certain mortgage-backed securities before the financial crisis. And earlier this year, the bank paid $425 million to New York state regulators to resolve charges that it failed to properly oversee traders who helped certain Russian individuals avoid capital controls through rigged trades.

Call a Securities Fraud Attorney Today

With offices in Los Angeles, their securities lawyers have helped securities fraud victims throughout Newport Beach, Laguna Beach, Mission Viejo, and Manhattan Beach and recovered over $100 million from banks and brokerages firms for their wrongful actions.

Contact an attorney at Dimond Kaplan & Rothstein, P.A., today to schedule an appointment or consultation to review your rights and options.