CFTC settles charges with BNY Mellon over reporting violations

The Commodity Futures Trading Commission (CFTC) settled charges with the Bank of New York Mellon for repeatedly failing to correctly report millions of swap transactions to a registered swap data repository.

BNY Mellon was in violation of a prior CFTC order, and it failed to properly supervise its swap dealer business as required by CFTC regulations.

The order imposes a $5 million civil monetary penalty and incorporates BNYM’s decision to retain an independent compliance consultant to review and provide advice regarding its compliance program.

“Accurate reporting is a core pillar of the regulatory regime for swaps, and every individual data field matters,” CFTC Division of Enforcement Director Ian McGinley said. “It is essential that swap dealers get this right. In that vein, I commend BNYM for its extensive cooperation, remediation, and decision to retain an independent compliance consultant to assist the bank in improving its compliance program and preventing the reoccurrence of misconduct.”

From approximately 2018 through 2023, BNY Mellon repeatedly failed to correctly report at least five million swap transactions and failed to properly supervise its swap dealer business with respect to swap data reporting.

Many of the reporting failures also constituted a violation of the CFTC’s Sept. 30, 2019, order against the bank, which required it to cease and desist from further violating some of the same sections of the regulations that are the subject of the current action.

In addition, BNY Mellon also failed to properly supervise its business as a swap dealer in that it had no written policies or procedures to monitor the voice communications of its associated persons (APs) in order to ensure its APs were complying with the CEA and CFTC regulations.

The reduced civil monetary penalty recognizes the bank’s self-reporting; acknowledges BNY Mellon’s representations concerning its remediation efforts, including engagement of an outside compliance consultant; and recognizes substantial cooperation with the Division of Enforcement’s investigation.

The post CFTC settles charges with BNY Mellon over reporting violations appeared first on Financial Regulation News .