JPMorgan Chase, Bank of America and Goldman Sachs Get $53,000,000 Fine

It has been just revealed that three of the most important banks out there were just hit with a huge fine. Check out the reasons for this below.

The Commodity Futures Trading Commission (CFTC) has imposed fines on three major US banks, namely JPMorgan Chase, Bank of America, and Goldman Sachs, for not accurately reporting millions of transactions in the swaps market.

The fines amount to $15 million, $8 million, and $30 million, respectively. The CFTC found that Goldman Sachs failed to comply with swap data reporting rules and disclose Pre-Trade Mid-Market Marks (PTMMMs), resulting in “unprecedented failures.”

The Dodd-Frank Act of 2010 mandates swap dealers like Goldman Sachs to provide PTMMMs to help counterparties make informed decisions before entering a swap.

Since the rule went into effect over 13 years ago, the CFTC made sure to state the fact that Goldman has violated the regulation over one million times.

“While Goldman has backreported more than 20 million swaps to date, the CFTC believes this figure significantly underestimates the true scope of the swap data reporting failures at Goldman.”

The notes continued and said the following:

“In addition, the order states, on more than one million occasions since 2013, Goldman provided counterparties with PTMMMs that were inaccurate or failed to provide a PTMMM entirely.”

The CFTC has found that JPMorgan failed to report important data related to foreign exchange (FX) swaps.

The bank neglected to report over 150,000 constituent FX spot transactions and misclassified certain transactions, resulting in their non-reporting.

Similarly, the CFTC has determined that Bank of America failed to report or accurately report almost four million swap transactions to data repositories.

These reporting errors were caused by 25 types of errors, primarily involving swap allocations that occur after a trade is executed and involve assigning a portion of the swap to clients who are the real counterparties to the original transaction.

The CFTC also found that Bank of America did not provide adequate supervision from around 2015 to ensure timely compliance with their swap dealer data activity and reporting obligations under the CEA and CFTC regulations.

While Bank of America and JPMorgan have admitted to the allegations as part of their swaps settlements, Goldman Sachs has not.