The latest compliance issues in wealth management across North America.

CFTC, BNP Paribas
The Commodity Futures Trading Commission has issued an order settling charges against BNP Paribas Securities for attempted manipulation of the ISDAFIX benchmark. The order requires BNP Paribas to pay a $90 million civil monetary penalty.  

The CFTC order found that over a five-year period, beginning around May 2007 and continuing through at least August 2012, BNP Paribas attempted to manipulate the US Dollar International Swaps and Derivatives Association Fix (ISDAFIX), a global benchmark referenced in a range of interest rate products. 

The CFTC said that BNP Paribas’s unlawful conduct involved multiple traders and included supervisors. The order found that BNP Paribas, through its traders, bid, offered, and executed transactions in interest rate swap spreads in a manner deliberately designed - in timing, price, and other respects - to influence the ISDAFIX in order to benefit the bank in its derivatives positions in vehicles such as cash-settled options on interest rate swaps and certain exotic structured products. 

In addition to the $90 million civil monetary penalty, the order requires BNP Paribas to cease and desist from further violations as charged, and take specified remedial steps, including measures to detect and deter trading intended to manipulate swap rates such as the ISDAFIX, to ensure the integrity and reliability of the bank’s benchmark submissions, and to improve related internal controls.