The Securities and Exchange Commission today instituted an enforcement action against Deutsche Bank Securities Inc., which has agreed to repay more than $3.7 million to customers, which includes $1.48 million that was ordered as disgorgement.

The SECs investigation found that traders and salespeople made false and misleading statements while negotiating sales of commercial mortgage-backed securities (CMBS). According to the SECs order, customers overpaid for CMBS because they were misled about the prices at which Deutsche Bank had originally purchased them. According to the SECs order, Deutsche Bank failed to have compliance and surveillance procedures in place that were reasonably designed to prevent and detect the misconduct that consequently increased the firms profits on CMBS transactions to the detriment of its customers.

The SECs order finds supervisory failures by the former head trader of Deutsche Banks CMBS trading desk, Benjamin Solomon, who did not take appropriate action after becoming aware of false statements made to customers by traders under his supervision, including specific misrepresentations about the prices that Deutsche Bank paid for the CMBS.

Were committed to ensuring that firms communicate accurate pricing information when transacting with customers in opaque markets, said Daniel Michael, Chief of the SEC Enforcement Divisions Complex Financial Instruments Unit. Deutsche Bank and Solomon failed to keep watch as traders generated profits for the firm at the expense of CMBS customers by misrepresenting purchase prices and other important details.

To settle the charges, Deutsche Bank agreed to reimburse customers the full amount of firm profits earned on any CMBS trades in which a misrepresentation was made. According to a payment schedule in the order, Deutsche Bank will distribute more than $3.7 million. Deutsche Bank also agreed to pay a $750,000 penalty. Solomon agreed to pay a $165,000 penalty and serve a 12-month suspension from the securities industry.

Deutsche Bank and Solomon consented to the SECs order without admitting or denying the findings. The order notes that the penalty amounts reflect substantial cooperation by Deutsche Bank and Solomon during the SECs investigation, including remedial efforts by the firm to improve its internal controls, compliance training, and surveillance efforts.

The SECs investigation was conducted by staff in the Complex Financial Instruments Unit and the New York Regional Office, including William Finkel, Elisabeth Goot, and Richard Hong. The case was supervised by Mr. Michael.

Order by: 
Per page:
  • There are no comments yet
   Comment Record a video comment
Related Feed Entries
The Securities and Exchange Commission today announced that it has charged New York-based investment adviser Premium Point Investments LP with inflating the value of private funds it advised by hundreds of millions of dollars. The SEC also charged Premium Points CEO and chief investment officer Anilesh Ahuja as well as Amin Majidi, a former partner and portfolio manager at the firm, and former trader Jeremy Shor. According to the SECs complaint, the scheme ran from at least September 2015 thro…
14 days ago · From Securities Exchange Commission
The Securities and Exchange Commission today announced the hedge fund advisory firm Visium Asset Management LP has agreed to settle charges related to asset mismarking and insider trading by its privately managed hedge funds and portfolio managers. Separately, the firms CFO agreed to settle charges that he failed to respond appropriately to red flags that should have alerted him to the asset mismarking. The SECs order finds that two portfolio managers of New York-based Visium falsely inflated t…
08.05.2018 · From Securities Exchange Commission
The Securities and Exchange Commission today announced that Japan-based Panasonic Corp. will pay more than $143 million to resolve charges of Foreign Corrupt Practices Act (FCPA) and accounting fraud violations involving its global avionics business. According to the SECs order, Panasonics U.S. subsidiary, Panasonic Avionics Corp. (PAC), a provider of in-flight entertainment and communication systems, offered a lucrative consulting position to a government official at a state-owned airline to i…
30.04.2018 · From Securities Exchange Commission
The Securities and Exchange Commission today unveiled a public service announcement (PSA) to encourage investors to check the background of their investment professional by using the free search tool on before investing., the SECs website dedicated to individual investors, provides investors with tools and resources to help them invest wisely and avoid fraud. Investor education is an important line of defense against fraud and is critical to our efforts to both protec…
16.04.2018 · From Securities Exchange Commission
The Securities and Exchange Commission today announced its staff will host a roundtable on April 23 that will address the market structure for thinly-traded exchange-listed securities,both equities and exchange-traded products.The roundtable, which will be held at the SEC's headquarters at 100 F Street, NE, Washington, D.C., will discuss the challenges faced by participants in the market for thinly-traded exchange-listed securities and potential improvements that might be considered to the marke…
13.04.2018 · From Securities Exchange Commission
0 votes
Michael Blair
Time is your GREATEST asset
12.02.2018 (12.02.2018)
0 Subscribers