The Hong Kong (SFC) Capital Maritime Commission (SFC) has reprimanded and imposes a fine on Deutsche Bank Aktiengesellschaft (DB) $ 23.8 million for various regulatory violations, including overwhelming customers in management fees, misleading products and investing investment. Relationships in research reports.
The disciplinary action of the SFC emerged from surveys caused by self -reports made by DB between December 2020 and December 2023.
SFC survey found that during various periods between November 2015 and November 2023, DB:
- Failed to implement the reduced management fees agreed with customers to 39 Portfolio Portfolio Management Accounts due to deficiencies in the processes and failures of DB in their implementation, resulting in these accounts overloading management fees.
- 392 level debit measures are incorrectly estimated, applying “fixed” interest rates which in turn influenced the portfolio of customer accounts, resulting in 92 customers overloading the guardian fees and management, as the fees were calculated on the basis of the paperwork. and
- Wonderful or underestimated the valuations of 16 capital of private shares and three capital real estate in monthly statements sent to 233 customers due to the combination of a surveillance of the external seller and the lack of proper DB checks to ensure that the prices of capital were informed by of the conditions.
Overall, DB overloads the customer fees of about $ 39 million as a result of these issues.
The SFC also found that DB failed to disclose investment banking relationships with various companies that introduced Hong Kong in 261 stock reports and 1,590 industry reports issued between September 2014 and September 2021, due to the failure of the disclosure system to take into account any investment services.
The regulator further found that DB incorrectly gave a lower product risk rating in 40 stock markets (ETFS) between August 2012 and December 2020, affecting 93 customers and 265 transactions. Following the application of the correct product risk rating to these ETFs, risk mismatches were found in 10 transactions where the product level of the product was higher than the level of customer tolerance.
In the light of the aforementioned findings, the SFC considers that DB has failed:
- They act with proper skill, care and diligence, in the interests of its customers and the integrity of the market.
- Make sure the performances made and the information provided to its customers are accurate and not misleading.
- Ensure compliance with the notification requirement in its research reports. and
- It complies with all the relevant regulatory requirements applicable to its business activities in order to promote the interests of its customers.
In determining sanctions, SFC has taken into account various factors, including the fact that DB has remedied issues and strengthened its internal controls and systems when detecting violations and DB’s cooperation with SFC in resolving its concerns and acceptance by SFC.