Deutsche Bank falls foul of the FSA and pays the price with a £6 million fine

Deutsche Bank felt the UK Financial Services Authority's wrath in April. The firm was fined more than £6 million for breaching FSA Principle 5, by failing to observe proper standards of market conduct and Principle 2, by failing to conduct its business with due skill, care and diligence.

According to the regulator, these breaches arose from two separate transactions conducted by Deutsche during March 2004. The first was in relation to a book build in Scania AB B class shares, while the second involved the stabilisation of Cytos Biotechnology shares.

In addition, the FSA has also imposed a financial penalty of £350,000 on David Maslen, Deutsche's former head of European cash trading, for being knowingly concerned in the failure to observe proper standards of market conduct in the Scania transaction.

The fines are in keeping with the FSA's new focus on enforcement, especially in the market abuse arena. Hector Sants, FSA managing director for wholesale business said in a statement: "The FSA has previously expressed a determination to act against institutional market misconduct and Deutsche's failure is an example of the type of conduct which the FSA will act against in its efforts to improve the overall quality of markets." OR&C