BNY Mellon Fined for Swap Reporting Violations

The Commodity Futures Trading Commission (CFTC) has fined BNY Mellon $750,000 for swap reporting violations that occurred between December 2012 and at least 2018. The bank, which had previously been fined for similar infractions in 2019, was cited for failing to comply with sections of the Commodity Exchange Act (CEA) and CFTC regulations.

As part of the order, BNY Mellon was required to implement written policies to monitor communications in languages other than English to ensure compliance with regulatory standards. The bank’s self-reporting of the violations led to a reduced penalty, and it has since retained an independent compliance consultant to assist with its compliance program.

“BNY takes its regulatory responsibilities seriously and is pleased to have resolved this matter,” a bank spokesperson stated.

This fine is part of a broader crackdown on swap reporting violations within the financial industry. Last September, the CFTC imposed fines totalling $53 million on Goldman Sachs, Bank of America, and JPMorgan Chase for similar reporting errors, with Goldman Sachs receiving the largest penalty of $30 million.

The Dodd-Frank Act of 2010 mandates that financial firms report all swap transactions to registered swap data repositories, a requirement that has been in place for over a decade. Despite this, the CFTC continues to identify significant reporting failures across major financial institutions, underscoring the need for stricter compliance measures.

“Accurate reporting is a core pillar of the regulatory regime for swaps, and every individual data field matters,” said Ian McGinley, Director of the CFTC’s Division of Enforcement. He emphasised the importance of compliance in preventing future violations in the industry.