CFTC Fines HSBC Bank USA, N.A. $45M for Manipulative and Deceptive Trading

The Commodity Futures Trading Commission (CFTC) recently issued an order simultaneously filing and settling charges against HSBC Bank USA, N.A. (HSBC), a provisionally registered swap dealer. The order charges HSBC with manipulative and deceptive trading related to swaps with bond issuers, spoofing, and supervision and mobile device recordkeeping failures at various times during approximately an eight-year period. 

The order finds HSBC violated the Commodity Exchange Act (CEA) at various times from approximately March 2012 to July 2020. 

HSBC is ordered to pay a $45 million civil monetary penalty; to cease and desist from further violations of the CEA’s anti-fraud, anti-manipulation, supervision, and recordkeeping provisions; and to engage in specified remedial undertakings. HSBC has represented that it has already undertaken and continues to undertake extensive remedial measures, as described in the order.

"The Commission has zero tolerance for manipulative, deceptive or spoofing transactions, including by registered swap dealers," said Director of Enforcement Ian McGinley. "Registrants need to take their supervisory responsibilities seriously to prevent this conduct. Today's order makes it crystal clear that the CFTC will continue to vigilantly investigate and prosecute disruptions to market integrity and fraud and endeavor to protect all market participants, including swap counterparties, from abusive practices."