A leading City bank is to pay a record £1.6 billion fine as part of a settlement with US and UK regulators over the rigging of interest rates.
Deutsche Bank’s fine from the UK’s Financial Conduct Authority (FCA) amounted to a record £227 million after the watchdog found traders manipulated rate submissions between January 2005 and December 2010. The FCA also accused the lender of repeatedly misleading it.
Other fines from authorities in the United States included $800m (£532m) from the Commodities Futures Trading Commission.
“This case stands out for the seriousness and duration of the breaches by Deutsche Bank - something reflected in the size of today’s fine,” said Georgina Philippou, the FCA’s acting director of enforcement and market oversight.
“One division at Deutsche Bank had a culture of generating profits without proper regard to the integrity of the market.
“This wasn’t limited to a few individuals but, on certain desks, it appeared deeply ingrained.”
The manipulation involved at least 29 bank staff and was primarily based in London but also Frankfurt, Tokyo and New York.
The FCA said the behaviour went unchecked due to inadequate systems and controls, with the bank taking more than two years to identify and produce all the relevant audio recordings it had requested.
Deutsche Bank tried to claim to the FCA that its systems had been adequate, even though the person making this statement knew it to be false.
Ms Philippou added: “Deutsche Bank’s failings were compounded by them repeatedly misleading us.
“The bank took far too long to produce vital documents and it moved far too slowly to fix relevant systems and controls.”
“This case shows how seriously we view a failure to cooperate with our investigations and our determination to take action against firms where we see wrongdoing.”
Other fines by the City watchdog in relation to the fixing of Libor and Euribor rates saw Barclays and UBS pay £59.5 million and £160 million respectively. Royal Bank of Scotland was hit with a fine of £87.5 million in relation to Libor misconduct.