Justin Perras, a spokesman for JPMorgan, declined to comment for this article and George Smaragdis, a Finra spokesman, wouldn’t address the conduct of specific firms. Finra’s agreements specify the banks won’t deny the findings or “create the impression” that the accord lacks a factual basis.
“Finra reviews the accuracy and timeliness of every single trade,” producing 125 enforcement actions related to Trace trade reporting in the past two years, Smaragdis said in an e- mailed statement. The reporting has improved as firms have become more automated, he said.
Dealers typically are required to report eligible corporate bonds to Finra within 15 minutes. As a group, they complied 98.3 percent of the time in the first three months of the year compared with 97.9 percent a year earlier, according to Finra. More than 90 percent of post-issuance corporate-bond trades are reported within five minutes of execution, Smaragdis said.
More Penalties
Morgan Stanley, owner of the world’s largest brokerage, failed to report at least 4,200 trades on time from May 2011 through March 2013, resulting in $35,000 in Trace-related fines, according to documents released last month.
“The issues involved in this settlement were technical in nature and did not impair the accuracy of Trace data,” said Christy Jockle, a spokeswoman for Morgan Stanley.
Deutsche Bank AG, Germany’s biggest lender, had more than 1,400 Trace-related errors along with supervisory gaps, and the Frankfurt-based company agreed to a $55,000 penalty, according to Finra documents released in February and March.
Goldman Sachs Group Inc. had about 200 Trace violations and was fined $20,000, and Citigroup Inc. had more than 180 incidents and was fined $60,000, Finra documents show. Both firms are based in New York.
Spokesmen for Goldman Sachs, Citigroup and Deutsche Bank declined to comment. Like JPMorgan and Morgan Stanley, the three firms consented to Finra’s censure without admitting or denying the findings.
Profit Squeeze