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Regulation

Deutsche Bank to pay $205 million fine to New York state over FX charges

Deutsche Bank will pay a $205 million fine to the New York State Department of Financial Services to settle charges that the bank engaged in unlawful conduct in its foreign-exchange business.

According to a consent order on the department's website, Deutsche Bank "repeatedly engaged in unsafe, unsound and improper conduct" from 2007 to 2013 as a result of its failure to implement effective controls over Deutsche Bank's FX business.

Deutsche Bank FX traders participated in multiparty online chat rooms, sharing confidential information, discussing coordinating trading activity, and attempting to manipulate FX currency prices or benchmark rates, according to the order.

As part of the settlement, Deutsche Bank will submit plans to the department to improve senior management oversight of the company's compliance with New York state laws and regulations for its FX trading business.

In a statement, Deutsche Bank said it "is pleased to resolve the NYDFS' investigation into historical practices relating to its FX business and that the NYDFS has recognized our extensive cooperation and remediation."

The settlement is the latest involving FX trade manipulation. The Federal Reserve Board of Governors on May 2 and the New York State Department of Financial Services on Tuesday each fined Goldman Sachs Group (GS) $54.75 million. Previously, regulators in the U.S., U.K. and Switzerland assessed a combined $3.4 billion in penalties in November 2014 against Citibank, HSBC, J.P. Morgan Chase, Royal Bank of Scotland and UBS.