DEUTSCHE BANK and Thomas Weisel have finally agreed to pay $100 million (£56 million) to settle a dispute with US regulators over the independence of research more than a year after ten other banks signed a landmark $1.4 billion settlement.
Federal and state regulators, including the US Securities and Exchange Commission, claim that the investment banking units of the two firms had inappropriate influence over research analysts, who issued reports to boost banking fees.
“Deutsche Bank Securities and Thomas Weisel Partners issued research reports that were not based on principles of fair dealing and good faith and did not provide a sound basis for evaluating facts,” regulators said. The reports by the firms’ analysts contained exaggerated or unwarranted claims and opinions about companies, they added.
Deutsche Bank agreed to pay a total of $87.5 million a repayment of $25 million, $25 million in penalties and $25 million to fund independent research. Of the total, $5 million will go to fund investor education.
Thomas Weisel will pay $12.5 million, which includes paying back $5 million plus a $5 million penalty. A further $2.5 million will go to fund independent research.
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For Deutsche Bank, half of $57.5 million will go to the SEC, and half paid to the state. For Thomas Weisel, regulators will split $10 million.