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Deutsche Fined $70m for Benchmark Manipulation The Commodity Futures Trading Commission (CFTC) has fined Deutsche Bank Securities (DBSI) $70 million for attempted manipulation of the USD ISDAFIX benchmark. The CFTC Order finds that over a five-year period, beginning in at least January 2007 and continuing through May 2012, DBSI made false reports and through the acts of multiple traders attempted to manipulate the US dollar International Swaps and Derivatives Association Fix (USD ISDAFIX), a leading global benchmark referenced in a range of interest rate products, to benefit its derivatives positions, including positions involving cash-settled options on interest rate swaps. James McDonald, CFTC director of enforcement, comments: “This action reflects the CFTC’s continued and vigilant commitment to protect those who rely on the integrity of critical financial benchmarks. There is no room in our markets for manipulation – we will continue to work hard to stamp it out, wherever we find it.”
CFTC Announces New IRS Market Measurement Commodity Futures Trading Commission (CFTC) chairman, Christopher Giancarlo, has released a new paradigm for measuring the size of the global swaps markets. In a speech delivered at a conference in New York, Giancarlo declared that “swaps have a problem of large numbers”, adding: “We have known it for a long time. Sizing the global swaps markets in hundreds of trillions of dollars has done nothing to bring clarity to newspaper accounts, policy discussions in Congress, or regulatory policy setting in the decade since the financial crisis. Rather, it more often confuses the issue and hinders dispassionate consideration and sound policy setting.” As a result, Giancarlo said that the CFTC must bring some clarity regarding how to accurately size contemporary swaps markets.
CFTC Files Spoofing Charges Against Three Banks, Five Individuals The US Commodity Futures Trading Commission (CFTC) has filed a total of eight charges against three banks and five individuals for spoofing in precious metals markets as well as other futures contracts. The Commission issued orders filing and settling charges against Deutsche Bank, requiring it to pay a $30 million fine; UBS, which is to pay a $15 million fine; and HSBC, which will pay $1.6 million. All three banks consented to the orders without admitting or denying any of the accusations.
Ashton Loses Appeal Against FX Ban and Fine The US Federal Reserve has refused to stay a motion issued last year that banned former Barclays FX trader Chris Ashton from the FX industry and fined him $1.2 million. Ashton appealed the decision, which was originally announced in 2016, only after it had formalised the ban last year, claiming, the Fed says, that the final notice was not relevant in the jurisdiction in which he resides – the UK - and that it was not served in a correct manner.
FCA Approves New Change as FX Benchmark Administrator New Change FX (NCFX) has been approved by the UK’s Financial Conduct Authority (FCA) as the first benchmark administrator for live FX spot markets under EU Benchmark Regulation 2016/1011.  NCFX produces live, consolidated, registered spot benchmarks for FX market customers. “The introduction of the NCFX benchmarks means that live FX execution can now be benchmarked against a recognised rate. FX deals can therefore be executed and benchmarked as they arise, rather than waiting for fixing windows. This gives freedom and flexibility to investors and their executing banks. NCFX benchmark rates are calculated 20 times a second so market users can act in the market whenever they choose, rather than being constrained by benchmarks that are calculated infrequently,” says NCFX in a release issued today.
DOJ Hands HSBC $101.5m Fine for Front Running HSBC has been fined $101.5 million for front running client orders, the US Department of Justice (DOJ) announced today. The bank has entered into a deferred prosecution agreement (DPA) and agreed to pay a $63.1 million criminal penalty and $38.4 million in disgorgement and restitution to resolve charges that it engaged in a scheme to defraud two bank clients through a multi-million dollar scheme commonly referred to as “front running”. The DPA, which was filed in connection with a two-count criminal information charging wire fraud in the United States District Court for the Eastern District of New York, is pending review by the court.  
Former Barclays FX Head in NYC Charged for Front Running Robert Bogucki, the former head of Barclays’ New York FX operation was charged yesterday in an indictment for his alleged role in a scheme to front run client orders. Bogucki has been charged in an indictment filed in the Northern District of California on January 16, with one count of conspiracy to commit wire fraud and six counts of wire fraud. He was due to make his initial appearance on January 17, at 2:00pm in Brooklyn, New York, before US Magistrate Judge Cheryl Pollak of the Eastern District of New York. According to the indictment, in September and October 2011, Bogucki is alleged to have misused information provided to him by Hewlett Packard (HP), which had hired Barclays to execute an FX transaction related to the planned acquisition of a UK-based company. 
South Korea Cryptocurrency Ban Talk Sends Bitcoin, Ethereum Tumbling The price of bitcoin has dropped significantly following new reports that authorities in South Korea might ban the trading of cryptocurrency exchanges. As mainstream news outlets started reporting on comments made by the South Korean Minister of Justice, Park Sang-Ki, that a bill is being prepared to ban the trading of cryptocurrencies, the price of bitcoin fell from $14,932 at 12:04am BST on January 11 to $12,884 by 4:20am BST, according to data from CoinDesk. At the time of writing, 5:55pm BST, the price has recovered to $13,746, which is still a 7.5% decline in the overall value compared to this earlier high.
Former RBS Trader Banned, Fined, by FCA The UK’s Financial Conduct Authority (FCA) has fined former Royal Bank of Scotland (RBS) interest rate derivatives trader, Neil Danziger, £250,000 and banned him from performing any function in relation to any regulated financial activity. Danziger was primarily a forward FX trader on the yen book at the bank but he also was RBS’s substitute submitter for the yen London Interbank Offered Rate (Libor) rate set, the activities investigated by the FCA. The FCA says it has found that Danziger was “knowingly concerned in RBS’s failure to observe proper standards of market conduct.
CFTC To Meet on Cryptocurrency Oversight US Commodity Futures Trading Commission chairman Christopher Giancarlo has welcomed an announcement from the Commission’s Market Risk Advisory Committee that it will hold a public meeting on January 31, 2018 to discuss the statutory and regulatory process for the listing of new and novel products on CFTC-regulated designated contract markets and swap execution facilities through self-certification. At the meeting, which is sponsored by CFTC Commissioner Rostnin Benham, CFTC staff from a variety of operating divisions will provide an overview of the current self-certification process and CFTC authorities and responsibilities related to the oversight, surveillance, and monitoring of listed derivatives products within CFTC jurisdiction.