Summary: In August 2025, the Securities and Futures Commission ("SFC") fined Deutsche Bank $23.8 million for regulatory breaches including overcharging clients on management fees, misreporting risk ratings for ETFs, and failing to disclose investment banking relationships. The violations affected numerous clients and resulted in overcharges of approximately $39 million. The SFC considered DB's remediation efforts and cooperation in determining the penalty.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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On August 28, 2025, the Securities and Futures Commission ("SFC") reprimanded and fined Deutsche Bank Aktiengesellschaft ("DB") $23.8 million for numerous regulatory breaches.
The SFC investigation revealed several significant infractions, including overcharging clients on management fees, incorrect product risk ratings, and inadequate disclosure of investment banking relationships in research reports.
DB overcharged clients by failing to apply discounted management fee rates to 39 discretionary portfolio management accounts, incorrect valuations of debt instruments, and misrepresented the valuations of private equity and real estate funds, impacting nearly 400 clients and resulting in overcharges of approximately $39 million.
Additionally, DB failed to disclose its investment banking relationships with Hong Kong-listed companies in a significant number of research reports, and incorrectly assigned lower product risk ratings to exchange-traded funds ("ETFs"), affecting over 200 clients and transactions.
DB's failures to comply with regulatory requirements and act with due skill, care, and diligence led to these breaches, and the SFC considered DB’s remedial actions and cooperation during the investigation before imposing sanctions.
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