Deutsche Bank has been fined a record £227m by the FCA for manipulating Libor and Euribor, and misleading the regulator.
Combined with fines imposed by other regulators in the US, the total penalties amount to $2.5bn (£1.7bn).
The fine is the largest to date for Libor- and Euribor-related misconduct.
DB Group Services (UK) Limited, a subsidiary of Deutsche Bank, has also pleaded guilty to the criminal offence of wire fraud for its role in manipulating Libor, the US Department of Justice says. The DoJ has imposed a penalty of $775m in relation to this plea, with the remaining fines levied by the Commodity Futures Trading Commission ($800m) and the New York Department of Financial Services ($600m).
Between January 2005 and December 2010, trading desks at Deutsche Bank manipulated its inter-bank offer rate submissions across all major currencies.
Libor and Euribor are based on daily estimates of the rates at which banks on a panel can borrow funds in the inter-bank market. They are fundamental to the operation of both UK and international financial markets, including markets in interest rate derivatives contracts.
The FCA says the misconduct involved at least 29 Deutsche Bank individuals, including managers, traders and submitters, primarily based in London but also in Frankfurt, Tokyo and New York.
In addition, the FCA says Deutsche Bank gave misleading information about its ability to provide a report commissioned by the German regulator, BaFin. Deutsche Bank did not disclose the report to the FCA and claimed that BaFin had prevented it from being shared, which was untrue.
The bank also provided the FCA with a false attestation that said its systems and controls in relation to Libor were adequate. The FCA says: “This was despite the complete lack of inter-bank offer rate systems and controls. It was known to be false by the person who drafted it.”
Finally, the regulator says its investigations were hampered because the bank failed to provide timely, accurate and complete information. In one instance, Deutsche Bank accidentally destroyed 482 tapes of telephone calls, which fell within the scope of an FCA notice requiring their preservation.
Deutsche Bank also provided inaccurate information to the regulator about whether other records existed.
FCA acting director of enforce-ment and market oversight Georgina Philippou says: “This case stands out for the seriousness and duration of the breaches by Deutsche Bank, something reflected in the size of the fine.”