HSBC to pay $75 million in penalties to settle U.S. CFTC charges
Business
Regulators have been targeting registered dealers for use of personal devices
NEW YORK (Reuters) - Units of HSBC Holdings Plc. have agreed to pay $75 million to settle U.S. Commodity Futures Trading Commission (CFTC) charges related to manipulative and deceptive trading and record-keeping failures, the regulator said on Friday.
HSBC Bank USA agreed to pay a $45 million civil penalty for manipulative and deceptive trading in connection with swaps, spoofing and record-keeping failures, CFTC said in a statement.
HSBCA Bank USA, HSBC Bank Plc and HSBC Securities admitted to charges related to record-keeping and supervision failures and agreed to pay $30 million to settle them, the regulator said in a separate statement.
"In recent years, we have made significant investments in enhancing our compliance procedures and have worked diligently to maintain the highest standards for professional conduct throughout our organization," an HSBC spokesperson said in an emailed statement.
Regulators found that HSBC traders engaged in manipulative and deceptive trading in interest rate swaps and other financial products. In some instances, bank supervisors were aware of the conduct and in one instance a senior manager directed the wrongdoing, the CFTC's order said.
HSBC did not admit or deny those charges, which were alleged to have taken place from March 2012 to April 2016.
HSBC also failed to stop employees, including senior staff and compliance personnel, from discussing work via personal text and WhatsApp, CFTC said. The U.S. Securities and Exchange Commission slapped HSBC with a penalty for related charges on Thursday.
Regulators have been targeting registered dealers for use of personal devices, saying that failure to maintain records can thwart oversight and investigations into potential wrongdoing.
